The South African Government announced tax exemptions on Wednesday to make investment in clean energy production attractive, while the country is mired in a serious electricity crisis that will also increase the country's debt.
From March 1, "businesses will be able to reduce their taxable income by 125% of the cost of an investment in renewable energy," Finance Minister Enoch Godongwana told parliamentarians in Cape Town, presenting the annual budget of the government.
Individuals who wish to install solar panels on their roofs "to reduce pressure on the grid and help alleviate" electricity outages will also be able to benefit from certain provisions, the minister added.
South Africa does not produce enough energy for its economy and its 60 million people. The continent's leading industrial power has been suffering for months from scheduled daily blackouts, lasting up to 12 hours on some days.
President Cyril Ramaphosa recently declared a state of national catastrophe.
State-owned Eskom produces 90% of the country's electricity, much of it from coal. After years of corruption and mismanagement, it is unable to produce enough energy in aging and poorly maintained plants.
In addition, Eskom carries a huge debt of more than €20 billion (R400 billion). The State announced last year that it would take care of half of this debt.