South Africa is still likely to see above inflation increases in electricity prices over the next few years, making it increasingly important for business owners to consider alternative sources of energy.
The large investments Eskom is currently making in infrastructure are likely to affect energy tariffs in the near future.
Since 2008 the average electricity tariffs in South Africa have increased by around 300%. According to our research, the next eight years will likely see a year-on-year tariff increase of at least 6% to 8%. In light of the upcoming 2017 Budget Speech, we are also waiting to find out if the government will introduce a new carbon tax. If this is the case, tariff increases could be as high as 13%.
SMEs should take advantage of the incentives provided for the installation of renewable energy solutions.
SMEs need to keep in mind that they can claim a percentage of the cost of solar and other renewable energy solutions back from SARS. Some banks also offer financing to their business banking clients for renewable energy solutions.
There are a number of benefits to installing solar energy solutions in small businesses, all of which contribute to reducing operating costs and downtime in the event of power outages.
A full solar solution can reduce the average SME’s electricity consumption by as much as 30%.
Reliability of energy supply is vital for SMEs. With this in mind, it is important for business owners to do a proper cost-benefit analysis to ensure that they are making the correct decisions, implementing the right energy solutions and using the optimal financing vehicle to reduce their annual energy spend.
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