Households with their own rooftop solar will soon be able to sell excess energy back to Eskom.
A feed-in tariff regulation is currently in the pipeline, says Gabriel Kgabo, GM: distribution at Eskom.
This announcement, made at the Solar and Future Energy Show Africa 2023 today, comes as government calls for comment on legislation to confirm solar installation incentives for businesses and households.
National Treasury and SARS have published – for public comment – the draft legislative amendments to give effect to the two renewable energy tax incentives announced in the 2023 Budget.
These proposals assist in partially addressing the country’s energy crisis and also encourage private investment into expanding electricity generation.
This initial batch of the 2023 draft Taxation Laws Amendment Bill (TLAB) covers these two specific tax amendments and are urgent, due to the proposed early effective dates for implementation, and to enhance certainty for individuals and businesses that would like to immediately invest in renewable energy.
The publication of the initial batch of the 2023 draft TLAB enables an early, and additional, public comment process that will enable the more detailed second round process of public comment when these provisions are incorporated in the more comprehensive 2023 draft TLAB in July 2023.
This initial batch of the 2023 draft TLAB is intended to solicit comments on the following two specific and urgent amendments, and serves as notice to taxpayers for earlier effective dates of the proposed amendments. Chapter 4 of the 2023 Budget Review provided more detail on the following two proposals:
Expansion of the renewable energy tax incentive
Under the enhanced renewable energy tax incentive, taxpayers who are conducting businesses will be able to claim a 125% tax deduction (in the first year) for qualifying capital expenditure in respect of all renewable energy projects – with no threshold on generation capacity. The enhanced incentive will be available for a period of two years and apply to investments in renewable energy projects brought into use for the first time on or after 1 March 2023 and before 1 March 2025.
Rooftop solar tax incentive
With respect to the rooftop solar tax incentive, individuals will be able to receive a tax rebate to the value of 25% of the cost of any new and unused solar PV panels, up to a maximum of R15 000. The rooftop solar tax incentive will be available for a period of one year and will apply to new and unused solar PV panels that are acquired by the individual and brought into use for the first time on or after 1 March 2023 and before 1 March 2024.
Public comments may include proposals by body corporates on how the rooftop solar incentive could be applied to members if they were to install solar PV panels for members’ benefit.
The draft legislation and the accompanying draft explanatory memorandum containing a comprehensive description of the proposed amendments can be found on the National Treasury (www.treasury.gov.za) and SARS (www.sars.gov.za) websites.
Comments need to be submitted by close of business on 15 May 2023.