South African industry has long treated diesel as a cost of doing business. With diesel prices increasing by between R7.37 and R7.51 per litre from 1 April 2026, among the sharpest monthly adjustments in recent history, the sums have changed.
The increase reflects heightened volatility in international crude oil markets, with Brent prices surging past $100 a barrel. Central Energy Fund data in April pointed to diesel under-recoveries of between R10.80 and R10.84 per litre for May. Although lower than the R17 level earlier in the month, it still signalled another substantial increase and indicates how quickly the picture can shift.
For South Africa, the exposure is acute. Following the 2022 closure of the Sapref refinery in Durban, the country refines less than 35% of the fuel it uses domestically. When global oil markets move, South African industry absorbs the full impact with little protection.
Manufacturing plants, logistics operators, mines and farms cannot pass every fuel price shock through to their markets immediately. Higher fuel costs cut into margins, make contracts harder to price and push up the cost of goods across the economy. Businesses cannot plan ahead. The problem is not the cost alone but the unpredictability too. A business cannot budget for a fuel price that moves R10 per litre in a month, and presents another substantial increase the following month, then shifts again as international market conditions evolve.
Renewable energy alternatives
Renewable energy solutions combining solar and battery storage offer certainty. Once a system is installed, generation costs are fixed. Battery storage extends availability beyond daylight hours, delivering round-the-clock operational flexibility and energy security. Together, they address what has become the most volatile item on the operating cost sheet with a stable cost that allows for forward planning.
Beyond cost certainty and energy independence, solar and storage also move operations towards decarbonisation targets. These are increasingly important for export-oriented businesses facing customer and investor pressure on Scope 1 and 2 emissions.
“South African industry has known for some time that diesel dependency carries risk,” says Nigel Sun, Head of Sungrow Sub-Saharan Africa. “The current fuel price environment has made that risk impossible to ignore and companies are reconsidering how quickly they can move to renewables solutions.”
For commercial and industrial operations, Sungrow’s Microgrid Solution combines solar generation, battery storage and conventional backup to reduce diesel dependence without disrupting operations. For mining businesses, where remote locations and high energy demand create particular pressures, this solution provides a reliable, scalable energy mix that ensures operational continuity, reduces fuel costs and lowers emissions.
A mine or factory that generates a significant share of its electricity from solar energy, stored and dispatched through a battery system, removes that portion of its energy use from the fuel price cycle. For operations most exposed to diesel price shocks, this represents a substantial and permanent reduction in risk.
“Businesses that just two years ago would have seen renewables or microgrids as a five-year consideration are now looking at the options with urgency,” says Sun. “Companies that move now won’t be scrambling when the next cycle hits,” he adds.
Global oil prices may ease in the short term. But in South Africa, as a country that imports most of its fuel, priced in dollars and tied to international market cycles, the fuel market does not become structurally less vulnerable because of any single news cycle. “Businesses that use this moment to reduce diesel dependency are addressing current pressures – and building resilience for whatever comes next,” says Sun.
For more information visit: www.sungrowpower.com
