Understanding Renewable Energy solutions, its benefits and how it works
A solar photovoltaic (PV) installation converts sunlight into a direct current using solar panels. An inverter further converts this energy into usable electricity (alternate current) which can be stored in batteries.
If your goal is to reduce your monthly electricity bill, a grid-tied system (which consists of solar panels and an inverter) is the best solution.
Consists of solar panels, an inverter and batteries (you can use a generator instead of batteries). These systems are considered to still be grid-tied as you would still draw electricity from the grid. This is the solution you are looking for if you want to reduce your monthly electricity bill and beat load shedding.
Allows your business to run independent of electricity supplied by Eskom or municipalities. These systems are typically larger (consisting of more solar panels) and require more storage in the form of batteries or generators.
What do I need to know before installing
This will depend on the end-goal that you want to achieve (reduce your electricity bill, survive load shedding, or run independently of the grid) as well as your energy consumption.
Check your monthly electricity statements or install temporary meter readers at your premises to determine your business’s average monthly electricity usage. The larger your energy requirements the more solar panels you may need.
The size of the inverter depends on how many panels you install. You may install a large inverter that will still perform well when you add panels in the short to medium term.
If your only goal is to reduce your monthly electricity bill, you may not necessarily need batteries in your installation. However, if you also want to avoid load shedding or remove your reliance on the grid, you will require more batteries. The battery capacity that you install should be sufficient to cover your business’s energy requirement for a specific duration of time (for example two hours of load shedding).
The supplier should have:
- An established and proven track record as a solar installer.
- Qualified electricians with proof of registration (a wireman’s licence).
- Conduct a site visit and produce a simulation or feasibility study of the electricity production estimate for the system for a year, including the average weather, size of the solar components needed (solar panels, inverter and batteries) to meet your business consumption needs.
- An understanding of Eskom’s regulation, municipal bi-laws, and the NERSA registration process.
- Service level agreements.
- The warrantees and guarantees for the installation.
- After completion, a certificate of compliance (COC) must be completed and signed off by a qualified electrician. Having your installation certified by a professional engineer, although not a requirement for all installations, would provide additional comfort for financing.
We have a list of vetted installers who have gone through the necessary due diligence to determine the installer’s knowledge and experience in the industry as well as their business operating model. Although we do not guarantee their work, these installers are pre-approved on our system and finance applications may therefore be fast-tracked.
For more information, please email our renewable energy experts at RenewableEnergy@absa.africa
Section 12B of the Income Tax Act
As of 2016, the amended section 12B allows for the accelerated depreciation of renewable energy assets.
Registration of grid-tied systems
If you want to install a grid-tied system, you will need to register and request approval from your municipality.
Registration with the National Energy Regulator of South Africa (NERSA) is required for all systems up to 100MW.
Certificate of compliance and sign-off
COC will need to be signed by a department of labour registered electrician. All earthing and electrical designs will need to be signed off by a professional engineer (PrEng, PrTechEng or Electrical) to ensure safety and compliance with regulations.
The majority of regulations in South Africa regarding batteries are written for backup power applications, namely uninterrupted power supplies (UPS). International battery energy storage standards are currently being updated.
This defines standards with which equipment, such as invertors, need to comply. Ensuring that your inverters are NRS097 compliant will provide you, and your financer, with peace of mind regarding the quality and warranty of your inverters.