introduced a R9-billion tax relief programme to reduce the impact of load shedding and support South Africa’s clean energy transition.
Godongwana said the tax incentive available for businesses to promote renewable energy would be temporarily expanded to encourage rapid private investment to alleviate the energy crisis.The current incentive allows businesses to deduct the costs of qualifying investments over a one- or three-year period, which creates a cash flow benefit in the early years of a project.
Treasury said businesses are able to deduct 50% of the costs in the first year, 30% in the second year and 20% in the third year for qualifying investments in wind, concentrated solar, hydropower below 30MW, biomass, and solar PV projects above 1MW. Investors in PV projects below 1MW are able to deduct 100% of the cost in the first year.