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2010 South African Solar Challenge

Solar power in South Africa includes photovoltaics (PV) as well as concentrated solar power (CSP). Installed capacity is expected to reach 8,400 MW by 2030, along with 8,400 MW of wind power.[1]

In 2014 several solar farms were commissioned, including the 96 MW Jasper Solar Energy Project, one of Africa's largest photovoltaic power stations providing enough solar power for 30,000 homes.[2]

Government Programs

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As of 1 January 2016 the South African government a tax incentive through the South African Revenue Service for the installation of photovoltaic solar energy generation systems. Depending on the size defined in MWp (Megawatt peak) of the photovoltaic solar system, the amended section 12 B of the Income Tax Act No. 58 of 1962 stipulates the size of the tax shield available through accelerated depreciation to the commercial tax paying entity. [3][4]

Photovoltaic Solar Systems ≤1 MWp

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Photovoltaic solar systems smaller or equal to 1 MWp can be depreciated according to the following schedule, granting the commercial tax paying entity a 28% discount on the system:

  • Year 1: 100% depreciation

The tax shield applies even if the photovoltaic solar system is installed mid-year[5] or if the system is not new[6]. A repayment time of one year and ongoing electricity savings for the remainder of the system’s lifetime can be achieved by financing a portion of the cost of the system.[7]

Photovoltaic Solar Systems >1 MWp

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Photovoltaic solar systems greater than 1 MWp are depreciated according to the following accelerated schedule:

  • Year 1: 50%
  • Year 2: 30%
  • Year 3: 20%

Adoption and Government Conflict of Interest

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Despite this aggressive tax incentive, South African companies are slow to adopt grid-connected photovoltaic solar systems due to the lack of public dialogue from the government concerning photovoltaic solar energy.

The lack of public dialog is partially due to the conflict that arises between the government, its state-owned enterprise Eskom, the local renewable energy sector as well as international obligations such as the Kyoto Protocol and the Paris Agreement of which South Africa is a signatory. The state-owned electricity utility Eskom that provides 90%[8] (85%[9] from coal) of South Africa’s electricity and depends on electricity sales to function. Due to alleged corruption and mismanagement of funds in the years leading up to 2017[10][11], Eskom has been forced to increase tariffs by 340% over 10 years[12]. Despite this tariff increase Eskom is in poor financial health as of 2017. The utility has stated that the increase in renewable energy generation directly impacts its revenue stream, which makes it difficult for it to meet its debt obligations. A government bailout has not been ruled out. The utility, relying mainly on coal-fired power stations also fears that renewable energy generation will directly impact coal jobs.[13]

Through its holding in Eskom, the South African government is dependent on Eskom's revenue stream to avoid a bailout with public funds.[14]

Municipal Programs

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In addition to the government tax incentive for photovoltaic solar energy generation, certain municipalities have further incentives for residential and commercial customers, such as a feed-in tariff or net metering.

Incentive Programs in Metropolitan Municipalities
Name Seat Type Notes Link
City of Johannesburg Metropolitan Municipality Johannesburg Feed-In-Tariff Embedded Generation ≤1 MW

Residential: R0.4279/kWh

Commercial: R0.3614/kWh

City Power
City of Cape Town Metropolitan Municipality Cape Town Feed-In-Tariff Small-scale Embedded Generation ≤1 MW

Residential: R0.7008/kWh

Commercial: R0.7008/kWh

City of Cape Town

Tariffs 2016/2017

eThekwini Metropolitan Municipality Durban Feed-In-Tariff Residential Embedded Generation

Single Phase: ≤2.6 kW

Three Phase: ≤13.8 kW

Residential: R0.68/kWh

Ethekwini Municipality

Tariffs 2016/2017

Ekurhuleni Metropolitan Municipality Germiston n/a City of Ekhuruleni
City of Tshwane Metropolitan Municipality Pretoria n/a City of Tshwane
Nelson Mandela Bay Metropolitan Municipality Port Elizabeth Net Metering Small-scale Embedded Generation ≤1 MW

Residential: 100% of electricity cost

Minimum cost: R0.00

Up to 1 year credit when monthly generation exceeds consumption

Nelson Mandela Bay SSEG Application

Net Metering Information

Policy Explanation

Buffalo City Metropolitan Municipality East London n/a Buffalo City Metropolitan Municipality Tariffs
Mangaung Metropolitan Municipality Bloemfontein n/a Mangaung Metropolitan Municipality

Plants - operational and projected

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See also: South African solar PV stations and South African CSP stations

[1] A 50 MW concentrated photovoltaics (CPV) power plant is planned for Touwsrivier, in Western Cape, South Africa.[15] A 75 MW solar power plant started production on September 13, 2013 in Kalkbult, in the Northern Cape (implemented by Scatec). Two other PV plants were completed by the same company in 2014. These are located at Linde in the Northern Cape and Dreunberg in the Eastern Cape, both sun drenched regions boasting some of the best conditions for solar power in the world. Altogether, these 3 plants provide power for around 90,000 South African households.

Sonnedix and Juwi have announced that they will construct an 86 MW solar photovoltaic (PV) plant in the Northern Cape province. The Mulilo Sonnedix plant in Prieska plant will be larger than any PV plant currently on line in the African continent, and was awarded through the third round of the South Africa's Renewable Energy Independent Power Producer Programme (REIPPP). Financial close on the project is targeted for July 2014, with commissioning planned for the second half of 2016.

Iberdrola has completed the Jasper Solar Energy Project solar photovoltaic (PV) power plant, which at 96 MW is the largest in Africa, the company announced. It was carried out in a desert area with extreme temperatures and involved the installation of over 325,000 PV modules. This PV plant is located in Northern Cape province in a remote, semi-desert location. It covers a surface area equivalent to 205 football pitches.

Acciona has put the Sishen solar photovoltaic (PV) plant into service in December 2014. It has a peak capacity of 94.3 megawatts (MWp) – 74 nominal MW – and is located in Dibeng in the Northern Cape province. Its horizontal tracking structures allow the PV panels to capture more radiation by following the sun’s trajectory across the sky. The plant will produce electricity equivalent to the consumption of around 100,000 South African households, or around 420,000 people (2011 South African household size = 3.6 persons).

As of January 2015 a total of 593 MW produced from PV plants were connected to the grid.[16]

A consortium led by ACWA Power International (Saudi Arabia) has completed commissioning of a 50 MW concentrating solar power (CSP) project in South Africa's Northern Cape in Dec-2015. The Bokpoort CSP project includes 9.3 hours of thermal energy storage, which will allow it to meet demand during peak hours between 5 and 9 PM. ACWA describes this system as the largest thermal storage system ever built for a CSP plant of its size and capacity. The South African solar power plant has set a new African record (26 April 2016) for the continuous, round the clock supply of electricity.[17]

Two CSP plants are being built by Abengoa in the Northern Cape. Khi Solar One is a Solar Tower plant of 50 MW capacity near Upington and Kaxu Solar One is a Parabolic Trough plant of 100 MW capacity near Pofadder with storage capability for 3 hours.

Solar Thermal Energy

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See also: Solar thermal energy

The South African government requires renewable energy to replace 10,000 GWh of electricity by 2013. The Department of Energy estimates that 23% of this target can be met through solar water heating and Eskom is therefore actively encouraging consumers to switch to solar water heating.[18]

Statistics

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Growth of Photovoltaics
Year Installations in MWp Production in GWh Ref
Cumulative Capacity Added Capacity
2011 1 – –
2012 41 40 –
2013 122 81 67
2014 957 800 1183 [19]
2015 965 8 2185 [20][21]
2016 1329 364 2347 [22]
MWp: megawatt-peak, nominal capacity
South African Growth of Photovoltaics
in megawatts since 2011[19]
250
500
750
1,000
1,250
1,500
2011
2012
2013
2014
2015
2016
Growth of CSP
Year Installations in MWp Production in GWh Ref
Cumulative Capacity Added Capacity
2015 100 100 188 [23]
2016 200 100 590 [24]
MWp: megawatt-peak, nominal capacity

See also

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References

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  1. ^ a b Solar energy in South Africa
  2. ^ "Massive South African solar plant comes online". My Board Band. 11 November 2014. Retrieved 16 November 2014.
  3. ^ "Taxation in South Africa 2015/2016" (PDF). South African Revenue Service. p. 40.
  4. ^ "Powering up: A look at section 12B allowance for renewable energy machinery". South African Institute of Tax Professionals. Retrieved 31 August 2017.
  5. ^ "Tax Incentive Through Accelerated Depreciation On Solar PV – Section 12B". econavitas.
  6. ^ "2017 Market Intelligence Report" (PDF). GreenCape. p. 42-43.
  7. ^ "Updated SARS Tax Incentive for Solar Power!". Grid Energy Solutions.
  8. ^ "Integrated Report". Eskom. p. 4.
  9. ^ "Integrated Report". Eskom. 2017. p. 57.
  10. ^ "Eskom auditors raise red flags over Koko, Molefe". Fin24. Retrieved 2017-09-01.
  11. ^ "Corruption charges laid against suspended Eskom CFO". Retrieved 2017-09-01.
  12. ^ "Tariff history". Eskom.
  13. ^ "Integrated Report". Eskom. p. 50.
  14. ^ "An Eskom bailout is on the way". Moneyweb. 2017-07-14. Retrieved 2017-09-01.
  15. ^ Soitec funded for 50MW solar power plant in South Africa
  16. ^ http://www.energy.gov.za/IPP/Electricity-Infrastructure-Industry-Transformation-13January2015.pdf
  17. ^ ACWA Power (26 Apr 2016). "Bokpoort Generation Record".
  18. ^ "Solar Water Heating Rebate Programme" (PDF). Retrieved 24 August 2013.
  19. ^ a b "Snapshot of Global PV 1992-2014" (PDF). www.iea-pvps.org. International Energy Agency — Photovoltaic Power Systems Programme. 30 March 2015. Archived from the original on 30 March 2015.
  20. ^ "2015 SNAPSHOT OF GLOBAL PHOTOVOLTAIC MARKETS" (PDF).
  21. ^ "NERSA". www.nersa.org.za. Retrieved 2016-06-27.
  22. ^ "Monitoring of Renewable Energy Performance 2016". www.nersa.org.za. Retrieved 2017-06-03.
  23. ^ "NERSA". www.nersa.org.za. Retrieved 2016-06-27.
  24. ^ "Monitoring of Renewable Energy Performance 2016". www.nersa.org.za. Retrieved 2017-06-03.
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