SAPVIA’s inaugural year saw the association grow from a small group of company interests to a significant industry mouthpiece. Credit should be given to the steering committee, (Kevin Robinson, Ryan Hammond, Davin Chown, Vincenzo Bellini, Mike Levington, Gerrit Kruyswijk and Warren Morse) for giving up their time and providing valuable input into the formation of SAPVIA, its constitution and its various developmental steps undertaken this year.
Some of our achievements
SAPVIA’s first goal was to respond to the zero allocation given to photovoltaics in the draft IRP published in October 2010. More than 15 meetings within three weeks were scheduled with key government officials from departments including Eskom, National Treasury, Departments of Trade and Industry, Economic Development, Energy and Environmental Affairs, Nersa and others to communicate two main messages from industry: firstly, PV is mature and bankable; secondly, its costs are declining.
A number of documents, including academic papers, were also written and submitted to the Public Participation Process administered by the Department of Energy and Nersa, and presentations were made at the Nersa Public Hearings held in Pretoria on feed in tariffs. Through this process SAPVIA contributed to the government’s decision making process in approving 8.4GW of photovoltaic energy up to 2025 in the promulgated IRP2010. The allocation for the first round of renewable procurement soon followed allowing for 1450MW of PV within the total allocation of 3750MW for all renewables.
The announcement of the first preferred bidders
On Wednesday, the 7th of December 2011, the DoE announced the preferred bidders for the first round of renewable procurement. 53 Bids amounting to 2 128 MW were received, of which only 28 bids with a total MW of 1 416 were selected as preferred bidders. Of the 1 416 MW reserved for the preferred bidders, 631.53 MW of that was taken by solar PV, and according to our calculations, 233.56 MW of the 631.53 MW allocation to PV, was taken by SAPVIA members directly involved in the IPP process. We would like to take the opportunity to congratulate all SAPVIA members who, either directly or indirectly, were successful in the bidding process!
SAPVIA continues to interact with government through the ongoing procurement process to ensure that any obstacles preventing the roll-out of PV to these allocations are mitigated.
SAPVIA has hosted a number of successful networking events in Johannesburg, Cape Town and Durban, including exhibiting at COP17 and interacting with Deputy President Kgalema Motlanthe, Ministers Ebrahim Patel, Naledi Pandor, Dipuo Peters and others. The Green Economy Accord, to which SAPVIA was a signatory, was launched at the conference. The Green Economy Accord is an agreement between government, business and labour, committing each to tangible targets in achieving low carbon based economic development growth through renewable energy.
SAPVIA also contributed to the establishment of the South African Renewable Energy Council, and will be represented there to ensure the interests of renewables are present in government’s decision making fora.
SAPVIA will be involved in the development of an Occupational Training Qualification for operation and maintenance of photovoltaic systems, and has launched a sub-committee to address the regulatory and financing obstacles with small-scale rooftop solar.
Our membership base currently stands just short of 50 members and we are pleased to report a steady growth in the numbers on a regular basis. In summary, it has been an excellent year for our association but it is only the beginning. Personally, I have enjoyed leading this initiative and I look forward to interacting with our members more in the future, and ensuring SAPVIA’s sustainability going forward.
Dr. Chris Haw
In the Lens
Some memorable moments at the COP17 CCR Expo and Soitec’s launch of South Africa’s
first CPV solar plant….
Deputy President Kgalema Motlanthe visits the SAPVIA stand at the COP17 CCR Expo
Minister Economic Development, Ebrahim Patel with Minister of Science and Technology,
Naledi Pandor, chat to SAPVIA member Philip Calcott of Thupela Energy about the Afritrak
Minister of Energy Dipou Peters at the SAPVIA stand
President Jacob Zuma giving his speech at Soitec’s innauguration ceremony of South Africa’s first
CPV solar plant. The 500 kW solar plant powered the COP17 global gathering
President Jacob Zuma, assisted by André-Jacques Auberton-Hervé, president and CEO of Soitec,
cuts the ribbon at the inauguration ceremony of the Hazelmere CPV plant
Soitec’s 500 kW CPV solar plant in Hazelmere, KwaZulu Natal
Auditing and Tax Advice compliments of BDO
Tax deductions for business using renewable energy
Despite approval of the IRP (Integrated Resource Plan) 2010 and Eskom’s implementation of increased energy tariffs, South Africa’s energy supply is by no means secure and power cuts are on the cards with the onset of winter and increased energy usage. Due to such challenges more businesses are exploring investing in energy saving systems and Government is making it worthwhile by giving taxpayers Income Tax deductions for achieving energy savings.
David Warneke, Tax Director at BDO South Africa says: “There are income tax advantages for businesses that make use of energy saving systems for trade purposes, but not for private individuals. If a taxpayer uses a tangible energy savings device in its trade, in general the taxpayer may write off the cost of the system, including direct costs of installation, as a wear and tear allowance over a time period. Recently the South African Revenue Service (SARS) indicated that the write-off period attributable to ‘solar energy units’ is 5 years. Where the taxpayer uses the device in its trade to generate electricity from wind, sunlight, gravitational water forces (up to 30 megawatts) or biomass, a special accelerated allowance is claimable instead of the wear and tear allowance. In this case the write off is 50 percent of the cost of the system, including the direct costs of installation, in the first year in which the system is brought into use, 30 percent in the second year and 20 percent in the third year. ”
In addition to the write off of the cost of the system referred to above, an allowance for energy efficiency savings is set to be introduced in the Income Tax Act from a date to be determined by the Minister of Finance. Warneke says: “The reason for this provision is to encourage conversion by taxpayers of old technologies to new ones. This often involves a substantial amount of capital expenditure and the perceived long pay-back period tends to discourage business from making upfront investments relating to energy efficiency savings.”
The Solar Future: South Africa | 25-26 January 2012 | Johannesburg
SAPVIA has formed a partnership with the Solar Future Conference and our Chairperson, Dr. Chris Haw will be speaking at the event. To view the full details of the conference visit the event website at: http://www.thesolarfuture.co.za/
SAPVIA members can register now with this special promotional code (TSFSA2012-SAPVIA-MEMBERS), which will give a 10% discount! Register at: http://www.thesolarfuture.co.za/registration-invoice/
Africa Energy Indaba: 25-26 January 2012 | Johannesburg
SAPVIA’s Chairperson, Dr. Chris Haw, will be one of the panelists debating ‘Which renewable technologies are the real option for SA’ at the upcomming Africa Energy Indaba. For more information on the full conference programme and speakers visit the event website at: www.energyindaba.co.za
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