The Ministry of Oil and Energy Senegal has excluded equipment used for the production of renewable energies from its Value Added Tax (VAT) in a bid to improve access to electricity by those living in rural areas.

The excluded renewable energy production equipment are for solar, wind and biogas. The Ministry also released a list of 22 electricity and biogas production facilities that are exempted from the VAT.

The types of equipment exempted for the production of Solar energy are the photovoltaic solar panel, the solar thermal collector or panel, the solar inverter, the solar battery, the solar water heater kit, the charge regulator, the solar lamp kit, the solar street lamp (comprising a solar panel, a battery and a lantern, editor’s note) and the solar pumping kit which comprises of a solar panel, a controller and a pump.

The green energy production components exempted from the VAT are the tower, the blade, the rotor, the nacelle and the hub. These are important equipment in the construction of wind farms.

The types of equipment exempted for the production of biogas are the biogas stove, biogas flow analyser, prefabricated bio-digester, biogas pump, desulphurisation unit, water trap, biogas generator and substrate mixing unit.

The Ministry said this will reduce the cost of acquisition for equipment by 18%. This is a part of a broader strategy by the government of Senegal, to achieve universal access to electricity in the country by 2025.

Decentralised solutions such as mini-solar grids, solar kits and large grid-connected power plants are part of what the government is relying upon to aid the successful implementation of this policy. An example is the 158.7 MW Taiba Ndiaye wind farm which was built under a public-private partnership (PPP) by Lekela, a joint venture between the British Investment Fund Actis and Mainstream Renewable Power.