#Budget2025: Implications for renewable energy solutions private producers

Source: © 123rf 123rf The Budget Speech provides the financial framework for the private sector to get involved in investing in renewable energy projects in South Africa

So says Impower, a specialist solar and energy storage company, Impower’s spokesperson and energy expert Matthew Cruse.

“There is an enormous pressure on government to double the capacity of our national grid by the year 2035,” says Cruse.

Comments made by the President earlier this year in his State of the Nation Address pointed to plans to help enable green manufacturing and municipalities to transition to renewable energy in South Africa.

This, says Cruise, further emphasises the importance of government efforts to support investment in renewable energy.

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Risk for South African producers

Europe has implemented their carbon border adjustment mechanism (CBAM), which can have severe consequences for locally produced products destined for export.

These measures financially penalise any producers who are deemed to be reliant on ‘dirty’ energy sources.

“There is a real risk for South African producers that have not embraced renewable energy and are still reliant on Eskom, as they will be severely affected by such tariffs,” says Cruise.

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Electricity infrastructure

Consumers have seen an effective doubling in the price of electricity over the last five years, which has put an incredible burden on poor and middle-class households who have to make a choice between food or electricity.

Cruse is encouraged that the government seems to be serious about getting involved with the better and more effective management of electricity infrastructure on a municipal level.

“As announced in the budget speech, municipalities will be assisted to ring-fence the revenues from distributing electricity, enabling them to run with operating surpluses.

“Efforts such as these support efficiency and better financial management and encourage companies such as ours to build solar farms inside municipalities.

“This has the benefit of the municipality receiving electricity at half the price and removing their demand from the national grid, which helps to reduce the strain that causes load shedding,” says Cruise.