Energy department reveals: Companies who save energy will get tax cuts

Your business will be incentivised for saving energy.

That's right.

Fin24 is reporting that tax incentives are being introduced for businesses that can show measurable energy savings.

The announcement comes weeks after power utility Eskom announced its power supply was under strain.

Here's how your business can benefit by saving energy

According to the director general of the Department of Energy, Nelisiwe Magubane businesses would have to register with the SA National Energy Development Institute (Sanedi) to qualify for the tax cuts.

The allowance for energy efficiency savings is in line with section 12L of the Income Tax Act which has been amended.

Magubane said 'this legislation makes provision for the minister of finance, in consultation with the ministers of energy and trade and industry, to develop and publish energy efficiency regulations.

While it's not yet clear how the tax incentives would cost the fiscus, the expected tax relief would be a 45 cents deduction on taxable income per kilowatt hour of energy saved, said National Treasury chief director Cecil Morden in the report.

Magubane said her department, Treasury, the SA Revenue Service, and Sanedi would hold workshops early next year to help businesses register and acquaint themselves with implementation of the process.

We'll keep you updated on when exactly these workshops will take place and how much you'll save by being energy efficient.