South Africa has proposed to cut subsidies for renewable energy with a review paper published showing that the National Energy Regulator of South Africa (Nersa) could slash incentives by 7%-40%.
"The renewable energy feed-in tariffs (Refits) approved in 2009 are reviewed as the financial and economic parameters used in the tariff determination of 2009 have since changed," the regulator said in the document.
While Brazil implemented a step-down process in its feed-in tariffs, the South American country had the system in place for many years. South Africa only brought its RE subsidies online in 2009, and it did have a positive effect on the country’s power generation sector. And although many speculate that the decrease in its Refit will deter investors, the likelihood that it will suffer is slim. Large corporations have been flocking to the country opening branches like wind power giants Vestas and Goldwind, and other developers were present long before the Refit was ever introduced.
The fact is, most investors see South Africa as the safest bet in Africa.
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