The opposition Democratic Alliance says the government should embrace privatisation in the energy sector – proposing a R75,000 tax rebate for households installing solar energy should it come to power after the 2024 national elections.<\/p>\n\n\n\n
DA leader John Steenhuisen said that the DA would push a multi-party government to introduce laws to privatise the country’s electricity market, including reintroducing a DA bill to create an Independent Transmission System and Market Operator that would be mandated to urgently establish a “fully private market for the trading and distribution of electricity”.<\/p>\n\n\n\n
As part of this process, the party would also push for an expanded R75,000 tax rebate to further encourage private households to install solar energy, he said.<\/p>\n\n\n\n
“We will table legislation to rapidly increase private electricity generation and transmission. It is time for South Africa to stop beating around the bush. We live in a failing state that cannot even fix potholes. That same state is never going to end load shedding,” Steenhuisen said.<\/p>\n\n\n\n
“It is time to embrace privatisation, especially when it comes to electricity.”<\/p>\n\n\n\n
The likelihood of the DA and a multi-party government coming into power in the 2024 elections is currently slim despite election polls showing that the ruling ANC is set to fall below 50% of the national vote for the first time.<\/p>\n\n\n\n
Support for the ANC is expected to drop to 48% from 57% five years ago, according to the median estimate of 14 analysts canvassed by Bloomberg. The DA is expected to garner 22% backing, and the populist EFF \u2014 currently the third-largest party \u2014 12.5%.<\/p>\n\n\n\n
Most analysts anticipate either an outright ANC win or for the party to work with smaller political parties to attain the 51% majority needed to form a government.<\/p>\n\n\n\n
Solar rebates<\/strong><\/p>\n\n\n\n Election campaigning aside, the government has already been forced to lean on the private sector to deal with the energy crisis in South Africa, with state-run power utility Eskom only showing slight improvements in maintaining the national grid at current levels.<\/p>\n\n\n\n Despite record levels of maintenance and a stated 5% reduction in unplanned outages, South Africa still faces daily load shedding, albeit at low stages.<\/p>\n\n\n\n Eskom’s own data shows that these lower levels of load shedding are only really possible because around 2,000MW of demand has been removed from the grid – likely permanently – as energy users turn away from the utility to source power elsewhere.<\/p>\n\n\n\n This ties into the mass adoption of rooftop solar by private households, where some 4,500MW of solar energy has been installed, taking a huge chunk of pressure off the grid.<\/p>\n\n\n\n In 2023, the National Treasury implemented a tax incentive for households looking to install rooftop solar, but the actual rebate was quite limited.<\/p>\n\n\n\n The solar panel tax rebate was announced by Finance Minister Enoch Gondongwana during the 2023 Budget when South Africa was facing higher levels of load shedding.<\/p>\n\n\n\n Under the system, individuals who pay income tax could claim a tax rebate to the value of 25% of the cost of new and unused solar PV panels, up to a maximum of R15,000.<\/p>\n\n\n\n The tax incentive is only applicable to solar panels bought and installed from 1 March 2023 to 29 February 2024, with analysts casting some doubt that the incentive will continue beyond this point.<\/p>\n\n\n\n In late 2023, economists at Nedbank said, “the government will likely discontinue the solar panel tax rebates introduced for the 2023\/24 tax year as load shedding becomes less intense.”<\/p>\n\n\n\n However, Electricity Minister Kgosientsho Ramokgopa has been in favour of the incentive continuing, even proposing that it be expanded to include inverters and batteries.<\/p>\n\n\n\n The future of the tax incentive will be made clear when Godongwana delivers his 2024 budget speech later this month.<\/p>\n\n\n\n
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