Abstract:
South Africa emerged as a country that fought and overcame arduous oppression.. Following the democratic revolution of 1994, the new government regime embarked on an enormous electrification rollout with the mandate of ensuring all households in the country have access to electricity. This did not come without huge challenges and the electricity supply network was already under pressure. This led to load shedding and in turn impeded economic growth. Consequently South Africa requires significant investment in new electricity infrastructure. In order to ensure sustainable economic growth, the provision of reliable electricity is a critical strategic imperative. One of the objectives (according to the Electricity Regulation Act, No. 4 of 2006) is to facilitate investment in the electricity supply industry. To empower and encourage electricity producers, including foreign investors, to enter into the market, it is imperative to critically assess the current tax allowances available for the construction of power station assets within South Africa's domestic shores. In addition, the concept of load shedding is not limited to South Africa, but is a form of reducing demand on the energy generating system and is experienced internationally. To understand the tax incentives offered by international countries to reduce demand on the electricity supply network, will form part of this assessment. Benchmarking will be done on South Africa's domestic tax incentives offered to local electricity generators against international suppliers of electricity.
