A legal framework for the promotion of renewable energy in South Africa through fiscal instruments

Abstract

South Africa's current energy sector places undue reliance on fossil fuels to fulfil the country's energy requirements. The use of these non-renewable energy resources are unsustainable, as millions of tonnes of harmful emissions are released and estimates are made that these resources will be depleted within the next 100 years. Therefore the country has to source alternative energy resources. Renewable energy resources (for example solar energy) are considered to release little or no harmful by-products and have an infinite supply. Therefore the South African government has to promote the use of renewable energy as part of its commitments to address climate change and to ensure sustainable energy resources. Some of the most popular regulatory tools that a state uses to control human behaviour, is through command-and-control instruments and fiscal instruments. The latter promotes behavioural changes by rewarding desired behaviour which ultimately advances the user's own best interest. Because of the nature of renewable energy governance, energy users can not be forced or compelled through commandand- control instruments to use renewable energy. They should rather be encouraged or persuaded to use this form of energy through market-based instruments. This is also the central hypothesis of this dissertation. The purpose of this study is to determine the extent to which the South African legal regime makes provision to promote the use of renewable energy resources through fiscal instruments. Therefore the various energy-related white papers, policy papers and legislation will be analysed. This study found that South Africa's legal regime only partly makes provision to promote the use of renewable energy resources through fiscal instruments. The policy part of the legal regime is fairly well developed, but the statutory regime lacks detail and in its current form, environmental/energy related legislation does not fully correspond with the lofty objectives of the policy framework.