Renewable energy in South Africa is energy generated in South Africa from renewable resources, those that naturally replenish themselves—such as sunlight, wind, tides, waves, biomass, and geothermal heat. Renewable energy focuses on four core areas: electricity generation, air and water heating/cooling, transportation, and rural energy services. The energy sector in South Africa is an important component of global energy regimes due to the country's innovation and advances in renewable energy. South Africa's greenhouse gas (GHG) emissions are ranked as moderate, and its per capita emission rate is higher than the global average. Energy demand within the country is expected to rise steadily and double by 2025.
Of all South African renewable energy sources, solar holds the most potential. Because of the country's geographic location, it receives large amounts of solar energy. Wind energy is also a major potential source of renewable energy. Due to the high wind velocity on the coast of the country, Cape Town has implemented multiple wind farms, which generate significant amounts of energy. Renewable energy systems in the long-term are comparable or cost slightly less than non-renewable sources. Biomass is currently the largest renewable energy contributor in South Africa with 9-14% of the total energy mix. Renewable energy systems are costly to implement in the beginning but provide high economic returns in the long-run. The two main barriers accompanying renewable energy in South Africa are: the energy innovation system, and the high cost of renewable energy technologies. The Renewable Energy Independent Power Producer Procurement Programme (REI4P) suggests that the cost associated with renewable energy will equal the cost of non-renewable energy by 2030. Renewable energy is becoming more efficient, inexpensive, and widely used. South Africa has an abundance of renewable resources that can effectively supply the country's energy.
Policies and regulations South Africa is a member of the International Renewable Energy Agency (IRENA), an international organization that promotes renewable energy policies. The IRENA helps with tools to create policies and the transition of technology necessary for renewable energy. It provides an assessment of resources, finance management, policy and legal framework, and the capacity of the energy sector.
Renewable Energy Feed-In Tariff (2009–2011) The National Energy Regulator of South Africa (NERSA) implemented the Renewable Energy Feed-In Tariff (REFIT) in 2009. The REFIT works to progressively reduce carbon-based power generation by moving in the direction of renewable energy sources. NERSA employed the REFIT in an attempt to meet the target of producing 10TWh of electricity by 2013. When first introduced, the feed-in tariffs applied only to wind energy, hydropower, and concentrated solar power (CSP). Six months after the introduction, the tariffs were expanded to include biomass and solar photovoltaics. The organization wants to achieve sustainability through the use of renewable resources while engaging stakeholders, lowering the cost of investment, and making the cost of electricity more affordable for all people. The decentralized investment opportunity provides South Africa with the resources to overcome its current energy crisis. REFIT is the first successful greenhouse gas mitigating projects used in South Africa. The REFIT program was superseded by the Renewable Energy Independent Power Producer Procurement Programme in May 2011.
Renewable Energy Independent Power Producer Procurement Programme (since 2011)
South Africa first introduced the Renewable Energy Independent Power Producer Procurement Programme (REI4P) in 2011. The program includes an initiative to install 17.8GW of renewable energy in South Africa before 2030. The goal of the REI4P is to reduce greenhouse gas emissions while minimizing the country's reliance on non-renewable energy sources such as nuclear and coal. REI4P also works to promote local manufacturing of materials used in the renewable energy sector.
Tax incentive (since 2016) To incentivize the further rollout of renewable energy generation by the private sector, the South African Revenue Service has of 1 January 2016 amended the Income Tax Act No. 58 of 1962 to include accelerated depreciation for renewable energy assets commissioned by a tax paying entity. This tax incentive is not limited to new renewable generation systems.
Photovoltaic solar energy generation Government plans make a special provision for photovoltaic systems that are smaller or equal to 1 MWp (megawatt peak) in section 12 B of the Tax Act. Owners can depreciate the investment 100% in the first year. Depreciating the photovoltaic solar system 100% in the first year grants the taxpayer a tax shield due to saved income tax. This provides, in effect, a 28% discount on the photovoltaic solar system. The tax shield applies even if the photovoltaic solar system is installed mid-year. By partially financing the photovoltaic solar system through debt, systems can achieve a repayment time of 1 year. Systems subsequently achieve ongoing electricity savings for each year of operation.
Other renewable energy generation Wind power, concentrated solar power (CSP), biomass, photovoltaic systems exceeding 1 MWp, hydropower not exceeding 30 MW as well as biomass systems are also incentivized through an accelerated depreciation with the following schedule:
Year 1: 50% depreciation Year 2: 30% depreciation Year 3: 20% depreciation Year 4: 10% depreciation
Types of energy
Solar energy
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