Solar PV for businesses in the Western Cape

This 2017 industry brief by GreenCape examines the financial viability, financing options, and regulatory landscape for solar photovoltaic (PV) installations for businesses in the Western Cape, South Africa. It highlights the role of local government policy, decreasing technology costs, and electricity price increases in driving adoption across the retail, commercial, industrial, and agricultural sectors.

• Solar PV installations can reduce business electricity costs by up to 16%, with typical payback periods ranging from 3 to 8 years. Given an average system lifespan of 20-25 years, a 100kWp system can potentially provide 15-20 years of free energy after an approximate five-year payback period.
• The financial viability of solar PV is influenced by several factors, including installation size, technology choice, exchange rates, location, roof type, financing models, and current electricity tariffs. Larger systems benefit from significant economies of scale; for example, systems over 500 kWp cost between R10,500 and R13,000 per kWp, whereas systems under 100 kWp cost between R13,500 and R16,000 per kWp.
• There are three primary financing options for solar PV in South Africa: self-funding, bank-funded loans (covering 70-100% of capital costs over five to ten years), and Power Purchase Agreements (PPAs). PPAs involve zero upfront costs for the buyer, as the developer absorbs the costs of design, construction, and maintenance in exchange for a long-term contract to sell electricity at a predetermined rate.
• The Western Cape government set a target to increase the contribution of rooftop PV to the province's electricity supply to 135MW by 2020. As of Q2/2017, the installed solar PV capacity in the Western Cape was 38MW.
• Various financial incentives are available for solar PV, including VAT deductibility for registered entities, the Green Tourism Incentive Programme (offering up to R1m in grants for small and micro tourism businesses), and tax benefits such as 100% accelerated depreciation in the first financial year (Tax benefit 12b).

APA

Radmore, J.-V., & Chilwan, S. (2017). Solar PV for businesses in the Western Cape. GreenCape. https://greencape.co.za/assets/Uploads/Industry-Brief-Solar-PV-FINAL-WEB-CORRECT.pdf

Chicago

Radmore, Jack-Vincent, and Seraj Chilwan. Solar PV for businesses in the Western Cape. GreenCape, 2017. https://greencape.co.za/assets/Uploads/Industry-Brief-Solar-PV-FINAL-WEB-CORRECT.pdf.

Wikipedia

{{cite report |last1=Radmore |first1=Jack-Vincent |last2=Chilwan |first2=Seraj |title=Solar PV for businesses in the Western Cape |publisher=GreenCape |date=2017 |url=https://greencape.co.za/assets/Uploads/Industry-Brief-Solar-PV-FINAL-WEB-CORRECT.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{radmore2017solar, author = {Radmore, Jack-Vincent and Chilwan, Seraj}, title = {{Solar PV for businesses in the Western Cape}}, institution = {GreenCape}, year = {2017}, url = {https://greencape.co.za/assets/Uploads/Industry-Brief-Solar-PV-FINAL-WEB-CORRECT.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }