South Africa’s National Treasury is set to introduce measures to promote the rollout of solar energy, including tax breaks and adjustments to the “bounceback” loan scheme. The announcement was made by President Cyril Ramaphosa during his State of the Nation Address on Thursday.
Ramaphosa said that the measures would help to “unleash” own generation among private households and businesses, which is a key part of the country’s plan to end the load shedding crisis. During the 2023 Budget on 22 February, finance minister Enoch Godongwana will announce how households and businesses can benefit from a tax incentive for rooftop solar.
In addition to the tax breaks, National Treasury will make adjustments to the bounceback loan scheme to help small businesses invest in solar equipment. The scheme, which was underutilized after the Covid-19 pandemic, will be updated to provide more support for small businesses.
Banks and financial institutions will also be allowed to borrow directly from the fund to facilitate the leasing of solar equipment to small businesses. These measures are expected to boost the availability of solar energy for businesses, and help South Africa transition to a cleaner and more sustainable energy system.
The government’s efforts to promote solar energy are part of a wider plan to address the country’s ongoing load shedding crisis, which has led to frequent power outages and blackouts. By encouraging the adoption of renewable energy sources, the government hopes to improve energy security and reduce reliance on fossil fuels.