South Africa is preparing to overhaul elements of its renewable energy trade framework in a move aimed at strengthening local renewable manufacturing and reinforcing domestic supply chains. The International Trade Administration Commission (ITAC) has issued preliminary findings outlining proposed adjustments to import tariffs, tax incentives, and procurement regulations for green energy components. These proposed measures are designed to promote local renewable manufacturing while supporting the country’s broader renewable energy transition.
Among the key recommendations is an increase in import duties on lithium-ion batteries, with ITAC proposing that the general customs duty on fully assembled units be raised to 15%. This measure is intended to stimulate local renewable manufacturing by encouraging domestic production of energy storage systems, particularly as demand continues to rise across South Africa’s renewable energy sector. In parallel, ITAC is reassessing the “staged consignment” policy, which currently permits developers to import complete equipment packages for large-scale projects without incurring duties when components are not locally available. However, the Commission has identified that several items including solar panels, inverters, trackers, and steel tower sections can already be produced domestically. Under the proposed revisions, these components may no longer qualify for duty-free importation, further supporting local renewable manufacturing.
For solar panels specifically, authorities are adopting a phased transition. A temporary rebate on imported panels will remain in place until domestic assembly capacity reaches at least 50% of national demand. This approach is intended to maintain supply stability and prevent disruptions to ongoing renewable projects during the shift toward local renewable manufacturing. At the same time, the Public Procurement Act of 2024 is expected to play a central role in enforcing local content requirements, with public sector developments likely to be required to incorporate a defined share of locally produced components.
To ensure effective implementation of these measures, ITAC has proposed the creation of a dedicated advisory committee made up of industry experts. This group would provide guidance on trade policies and help maintain a balance between industrial development and practical project delivery. The proposals remain under review, with ITAC currently seeking stakeholder input and conducting consultations. The objective is to ensure that final policies support economic growth and the renewable energy transition without significantly increasing project costs, while continuing to advance local renewable manufacturing across the sector.
