From 2007 to 2022, electricity tariffs increased by 653%, whilst inflation over this period was 129%.
2023 saw further increases of 18.49% and in 2024 a further 12.7% is approved by NERSA.
Until 28 February 2025, under section 12B of the Income Tax Act, businesses will be able to claim a 125% deduction in the first year for all renewable energy projects with no thresholds on generation capacity.
A renewable energy investment of R1 million would qualify for a deduction of R1.25 million against taxable income. Using the current corporate tax rate (27%), this deduction could reduce the corporate income tax liability of a company by R337 500 in the first year.
This incentive offers a payback period of a complete system in as soon as 3 years, coupled with uninterrupted business continuity.
