South Africa has the good fortune of possessing many renewable
energy sources that remain largely untapped, wind and solar energy
being amongst them. However, despite abundant renewable
energy sources, developing sustainable markets for renewable energy
technologies presents complex challenges as financial obstacles
often hinder advancement.
Machinery and plant relating to electricity generation from
wind, sunlight, gravitational water and from biomass (that
comprises of organic wastes, landfill or plants) is depreciable.
These assets are depreciable over a three-year period at a 50:30:20
per cent rate. The purpose of this accelerated depreciation regime
is to stimulate investment in these assets, thereby encouraging
investment in renewable energy projects. The lower the cost of
electricity generation, the higher will be the profit margin for
taxpayers involved in electricity generation from renewable
energy.
