Farmers heading into an El Niño season face rising energy costs on top of lower output, and solar is the most direct way to bring those costs under control, according to Juandré Pitout, Head of Business Development at RenEnergy.
In the Medium-Term Budget Policy Statement (MTBPS), tabled on 21 October 2026, National Treasury warns that the expected El Niño will raise costs and reduce agricultural output from late 2026 into 2027. The downturn comes after agriculture grew by 3.5% in the first half of 2026. Treasury has also increased its contingency reserve to R10 billion to cover the response to drought and El Niño, as well as further energy price spikes.
“A dry season turns water into an energy problem. Farmers have to irrigate more to keep crops alive, and every extra hour of pumping is paid for in diesel or grid electricity. That makes energy one of the costs that rises fastest when the rain fails,” says Pitout.
Treasury’s forecasts point to continued pressure on energy prices. It expects oil prices to rise by about 41% this year because of reduced exports from the Persian Gulf. It forecasts electricity price inflation of 8.3% in 2026 and 8.2% in 2027, rising to 8.8% in 2028.
“Farmers can’t control the weather or the oil price, but they can control where their power comes from. Solar and battery systems for irrigation pumping and cold storage replace the fuel and grid costs that climb most in a dry year. Farmers who install now will have those systems running before the dry season peaks, when they need to pump the most,” adds Pitout.
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