What’s stopping the batteries bought to beat power outages across Africa from becoming the continent’s cheapest peaking resource?
Africa reversed the grid infrastructure sequence when households and businesses started paying for their own batteries to survive unstable power supply and diesel costs.
In South Africa, thousands of home and business batteries sit idle for weeks, waiting for a power outage or the (hopefully not) return of aggressive loadshedding. Pooled into a virtual power plant (VPP), these batteries hold more storage capacity than Eskom is building.
Note that VPPs don’t produce power; instead, they use software to manage and conserve energy more intelligently. Seeing this as an opportunity for South Africa, Plentify and Deye plan to aggregate 160,000 of those batteries into a 2.7GWh VPP, about 1.9 times Eskom’s 1,440MWh battery energy storage system (BESS) programme.
Batteries paired with sun-injected rooftops
South Africa now has >8.3GW of rooftop solar, more than its two flagship IPP procurement programmes combined, and more than 90% of residential systems sold include a battery. And this trend isn’t confined to South Africa. In Nigeria and the DRC, battery imports far exceed solar.
Puerto Rico is a good case study of how the VPP tradeoff works. The country has a weak grid with long outages, and almost every rooftop solar system includes a battery. About 70,000 Tesla Powerwalls are enrolled in LUMA’s VPP, which helped avert rolling blackouts during 2025 grid emergencies.
Customers are paid per kWh delivered, can set a reserve the utility never touches, receive advance notice, and opt out of any event. The pilot paid about $1–1.25/kWh through installers such as Sunrun and Sonnen, and Sunrun called it “three times the value of net metering.”
The battery therefore serves as the customer’s insurance first and a grid asset second, which is a key bargaining chip in the African market.
The economics behind the system
But is the economic case sound? According to The Brattle Group, a VPP’s reliability capacity at roughly 40–60% of the cost of a gas peaker or utility-scale battery is reason enough to push through implementation.
Admittedly, VPPs will not meet large baseload needs, but they have proven cost-effective for peak demand reductions of up to 20%.
Eskom says VPPs may help defer some infrastructure investment but will not replace new generation and transmission infrastructure. Yet the investment made during the crisis years now sits on rooftops as a stranded grid asset.
To unlock its value, stakeholders need to agree on a VPP definition, licensing, compensation and data ownership. [Download the volume to get more battery and energy content]
