Who pays for rooftop solar? Cost shifts, stakeholder perspectives and policy tensions in South Africa

Rooftop solar is expanding rapidly across the world, raising concerns about utility revenue loss, cost recovery, and fairness in electricity pricing. This paper analyses the cost impacts of rooftop solar on South African municipalities, where over 10% of the national installed generation capacity now lies behind-the-meter, and examines how these impacts are framed by different stakeholder perspectives. Using data from 165 municipal electricity distributors, the study assesses widespread narratives – such as the belief that municipalities generate excess profits from electricity sales, or that solar users drive major cost shifts – and tests them against system-wide evidence. Findings reveal that most municipalities are under-recovering electricity costs and rely heavily on cross-subsidies to support low-income customers, making them vulnerable to even modest revenue erosion. While solar-related cost shifts do exist, they are moderate in scale and vary significantly across contexts. The analysis highlights deep institutional and governance constraints, conflicting stakeholder interests, and the need for regulatory responses that are guided by evidence rather than perception. Rooftop solar is not the root cause of South Africa's electricity distribution challenges, but it exposes underlying structural weaknesses that demand urgent attention.