How to decide whether to move to solar

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Simple steps are provided here that other’s try complicate Do not let others confuse you. As in previous blog.
Decide on what your SOLAR SYSTEM you require. Get a full installation quote or if you aware with what is needed and you already have a system in place. Living off the Grid will happily assist you in anyway required

  1. DO ENERGY AUDIT.
    • Lights 
    • Appliances
    • Hot Water
    • Media (TV & HiFi)
    • Aircons
    • Heaters
  2. IDENTIFY RENEWABLE ENERGY OPPORTUNITIES.
    • Solar Geyser for Hot Water
    • Solar system required. May include WIND TURBINES
  3. GET QUOTES FOR FULL INSTALLATION NEEDED
    • Quote for full installation
    • Quote for upgrades
    • Quotes for expansion including WIND TURBINE options
  4. ANALYSE & PREPARE BUSINESS CASE FOR CHANGES.
    • Compare financials against payment plan and existing electric bill WITH increases over time
    • Secure Finance
    • Intervention and installation
    • Ongoing measurement and verification of benefit

Financial Analysis

As mentioned above. The first step in the process of designing a Solar Power system is to perform a financial analysis to determine the financial feasibility of the project.

Electricity Bill – This will provide information on the electricity rates and the quantity of energy used.
Address – the address will provide the Google Map view to determine the size of the solar system that can be accommodated on the exiting roof
Profile Graph – Ekurhuleni municipality has a digital billing system for all their business customers. A detailed graph is available that plot the usage profile over time. Some of the other municipalities also has this information available.
The profile graph provide the following information

  • Peak Demand
  • Baseload Demand
  • Demand at 12:00

The result of the financial analysis will be a table with all the important financial indicators to support the investment decision:

  • IRR: Internal Rate Return
  • NPV: Nett Present Value
  • Yield
  • Payback Period

Electricity will cost you an average of R 0.16 / kWh for the next 25 years with a Solar power system! Eskom power will cost you an average of R 2.99 for the same period!

Tax Incentives

Tax Incentive: Depreciation.  As per the Income Tax Act 58 of 1962, Part 12B – Deduction in respect of certain machinery, plant, implements, utensils and articles used in farming or production of renewable energy

Extract from Subsection (2)
The deduction contemplated in subsection (1) shall be calculated on the cost to the taxpayer of the asset, as referred to in subsection (3), and the rate of the allowance shall be –
a) in respect of the year of assessment during which the asset is so brought into use, 50 per cent of such cost;
b) in respect of the second year, 30 per cent of such cost; and
c) in respect of the third year, 20 per cent of such cost

As from 1 January 2016 Section 12b of the Income Tax act (South Africa) was amended from a three year (50% – 30% – 20%) accelerated depreciation allowance on renewable energy to an even quicker depreciation allowance of ONE year (100%).

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