Section 12L Energy Efficiency Tax Incentive
Section 12L of the income tax act no. 58 of 1962 of South Africa gives companies a tax incentive of 95c/kWh for energy savings or energy equivalent savings achieved through energy efficiency projects. Measurement and Verification (M&V) of energy savings is required to obtain the tax incentive. Oelinga is a SANAS accredited M&V inspection body (Accreditation Number: EEMV0019) under international standard ISO 17020 and SANS 50010.
01
Eligible Projects
These projects qualify for the Section 12L tax incentive:
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Energy efficient equipment and/or facilities
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Manufacturing process improvements
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Logistics and transportation fleet upgrades
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Waste heat recycling
02
The Process
Measurement and verification (M&V) according to the SANS 50010 standard is required to quantify the energy savings. This is performed by a Certified Measurement and Verification Professional (CMVP®) working for a SANAS accredited inspection body for M&V.
03
Retrospectively Claimable
The Section 12L tax incentive is retrospectively claimable for all energy efficiency projects implemented from November 2013. The tax incentive is at 45c/kWh for projects implemented between November 2013 to March 2015 and 95c/kWh for projects after March 2015.
04
Administration
The energy savings must be quantified and reported by a SANAS accredited M&V inspection body, which submits inspection reports to SANEDI for approval. Once approved, SANEDI issues a tax certificate, which is used to claim the tax incentive from SARS.