Just Energy Transition (JET) is making steady progress with renewable energy sources now contributing nearly 10 percent to the national grid. Not accounting for any other on-farm installations, which is the subject of this article, agriculture South Africa can safely claim to be almost 10% green.
This is progressive considering that agriculture South Africa is heavily exposed to the export markets, some of which are actively pursuing green policies and imposing them on trading partners. Specifically, over 60% of horticultural fruits are exported with over 40 percent exported to Europe and the United Kingdom (UK). This makes agriculture South Africa not only export-oriented but also exposed to green policies of importing nations.
Europe is leading in green policies, targeting to reduce greenhouse gas emissions by 55% in 2030, compared to 1990s levels with the ultimate aim of being the first climate-neutral continent in the world by 2050. One of the legislation within the EU Green Deal that is relevant to agriculture South Africa is the EU Carbon Border Adjustment Mechanism (CBAM, pronounced Si-Bam), a carbon tariff levied on carbon intensive goods imported into the EU.
While agricultural products are currently exempted from carbon tariff, there are member countries that are supportive of extending CBAM scope to agriculture. Therefore, the sector cannot be complacent as other countries such Canada, Japan, the UK and Australia are also considering introducing their own versions of CBAM. As the adages goes, ‘customer is king’ and therefore, the EU’s climate requirements should be taken on-board by all trading partners, including South Africa.
Locally, South Africa also introduced Climate Change Act in 2024 as demonstration to the global commitments to reduce emission of greenhouse gases. There is also carbon tax that, like sin taxes, can be expected to increase with each passing budget year.
Beyond the 10% contribution from the green energy sources to the national grip, is agriculture South Africa investing on supplementary green energy sources to complement Eskom’s? This is an important but a difficult question to answer due to lack of data. However, looking at Eskom’s Integrated Annual Reports, it is possible to get a sense of direction the sector is taking to transition to green production processes.
Agricultural businesses, like all others, are supplied electricity either through Eskom or municipalities. Looking at Eskom data, the power utility lost 14% (11,823) of the customer base in the last decade (see Figure 1). Electricity sales to the sector, through Eskom, peaked in 2019 at
5,796 GWh from whence it started declining (see Figure 2).
Considering general poor service delivery in municipalities and local government, it is reasonable to expect that these too lost customers. Over the same period, gross value of agriculture more than doubled, increasing from R225 billion to
R450 billion. Energy utilisation ought to have increased by some margins, though not by the same margins due to efficiencies of new technologies. Growth of the sector should be at the expense of the planet.

Source: Eskom Integrated Report, 2024
The above is however not sufficient to conclude that has been a gradual transition to off-grid Green energy sources. Some of the declines in agricultural customer base could be ascribed to liquidations while others could be due to consolidation of adjacent farms/agribusinesses. Consolidation is difficult to trace but data on liquidations is readily available. Still, new farming ventures were established and hooked onto either Eskom’s or municipal grid. Looking at liquidations, data from Statistics South Africa reveals that only 182 agricultural businesses were liquidated over the last decade. This is too small a number to provide any meaningful explanation to the agricultural customers that Eskom lost. But there are also many land reform farms that have failed, adding to the loss of customer base.
Load-shedding peaked in 2022 after which the pace of Eskom’s loss of agricultural customers accelerated to 4% per year, from an average of a percent per year. It is reasonable to conclude that much of the transition was driven more by load-shedding than by deliberate and intentional attempts to move to renewable energy sources. In other words, transition was imposed on the sector and not due to climate considerations. With load-shedding fading into distant memories, agriculture South Africa will have to be intentional about embracing JET and all other climate change related regulations. At the recent Global Forum for Food and Agriculture (GFFA), Minister Steenhuisen spoke about bio-economy that will take into consideration issues of climate change, environmental degradation and sustainable of the food systems.
The market is awash with investible funds seeking to invest and support transition. There are ‘Green funds’, there are green financial products such as green bonds and others. There are also companies offering green turnkey green energy solutions, some even guaranteeing costs savings. Renewable technologies are also becoming cheaper and more reliable. Therefore, lack of transition would not be for the lack of funds but possibly affordability or ignorance.
By way of conclusion, world leaders are distracted by wars and it is up to the private sector, including agriculture, to take the lead in decarbonisation efforts. Judging by extreme weather patterns, the planet earth is already communicating that it is at the limit of planetary boundary on greenhouse gases. To this end, it is encouraging to notice small-scale solar farms dotting farming areas around the country but more can still be done. Let the decarbonisation journey continues with dedication, focus and intentionality.
Disclaimer: The views expressed in this article is solely that of Independent Agricultural Economist Robert Matsila, and does not necessarily reflect the views of Mzansi Agriculture Talk, his employers, or other associated parties.
