Renewable Energy and Policy Risk

South African government policy and Eskom lethargy have long posed a risk to independent power providers and particularly renewable energy project developers. The rules change, policy documents take forever to be released, and ultimately the economics of the subsidies can be quite different from envisaged.

FT has an OpEd on virtually the exact same issue in the UK, albeit in a far more developed market for renewable energy. The article actually throws the net wider and talks to traditional fossil-fuel based companies also having to deal with tax and regulatory uncertainty.

I suppose the message here for South African Independent Power Producers and Renewable Energy initiatives is that, get used to it, uncertainty around public policy in the energy space is here to stay.