Johannesburg — THE market for renewable energy equipment in southern Africa is likely to see revenue increase 10 times to $262,3m by 2015, according to consultants Frost & Sullivan.

The prediction augers well for SA, which is anxious to get the renewable energy industry off the ground.

The government has set a target of 10000GWh of renewable energy contribution to final energy consumption by 2013.

The National Energy Regulator of SA (Nersa) earlier this year released feed-in tariffs for the various renewable energy tariffs -- a mechanism to promote investment in renewable energy that places an obligation on a renewable energy purchasing agency to buy electricity from renewable energy generators at predetermined prices.

Despite the ambitious government targets, SA has seen little investment in renewable energy projects. The Darling wind farm in the Western Cape is the country's most significant investment in renewable energy.

A proposed 100MW wind farm is one of the projects Eskom put on hold on account of the global financial crisis.

Frost & Sullivan yesterday said the renewable energy equipment market was set to see revenue increase from last year's $28,4m to $262,3m by 2015.

Frost & Sullivan energy analyst Sipha Ndawonde yesterday said: "The growth of the wind-power market and large- scale solar concentrating projects will be driven by an increasing number of joint ventures. Such ventures will be between project developers with local knowledge and private equity investment firms, backed by the support of international original equipment manufacturers," Ndawonde said.

With tightening sources of global credit and more countries reporting negative economic growth rates, he said private equity investment companies had become more selective and strategic about the sectors in which they invest.

Sustainable energy project portfolios had bulged to more than $1bn, dedicated to financing renewable energy projects in southern Africa, he said.

This was an indication that investors saw renewable energy and energy efficiency projects in the region as having favourable returns and representing solid investment decisions.

"An abundance of natural resources combined with a stable political environment, reasonable economic growth rates and growing interest from private equity firms means that large-scale renewable energy projects are set to penetrate into the southern African countries of SA, Botswana and Namibia," Ndawonde said.

Nersa has released a consultation paper for phase two of the feed-in tariffs.