The FDC is in the process of recruiting an investor to set up a solar park in the Xhariep District in the Free State. Investment in renewable energy and energy efficiency are important to reduce the negative economic, social and environmental impacts of energy production and consumption in South Africa. Currently, renewable energy contributes relatively little to primary energy and even less to the consumption of commercial energy.
The use of solar power for electricity generation is deemed a non- consumptive use of natural resources and produces zero greenhouse gas emissions. Solar-generated electricity is set to play a significant role in reaching the South African government's renewable energy target of 10GWh of renewable energy by 2013.
Feed-in tariffs guarantee prices for developers, but there is a lack of certainty on the amount of renewable electricity such laws would deliver under local conditions. Portfolio standards set a fixed quantity, which would guarantee diversity of supply. Power purchase agreements, access to the grid and creating markets for green electricity and some supporting activities are key sector support policy options.