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Eskom Distribution company unbundling

Summary

Distribution’s role is to service the customer through building, operating and maintaining Distribution assets, while also acting in the national interest by actively partnering with the wider industry in resolving Distribution industry issues and enhancing stakeholder relations

Canvas not supported.

Is it working?

To be determined- The distribution company has only been legally unbundled but it has not been officially set up as a subsidiary

Actions

To complete the unbundling of Eskom and setting up of a generation company

Are there plans?

To complete the unbundling of Eskom

Is it on the agenda?

The distribution company has recently been legally separated from Eskom but it is not yet operational and has not been unbundled from Eskom

Goals

To have a separate distribution company from Eskom

Documents

References

Departments / Govt Institutions

Department of Electricity and Energy Eskom Holdings

Summary

Distribution’s role is to service the customer through building, operating and maintaining Distribution assets, while also acting in the national interest by actively partnering with the wider industry in resolving Distribution industry issues and enhancing stakeholder relations.

Canvas not supported.

Is it working?

To be determined- The distribution company has only been legally unbundled but it has not been officially set up as a subsidiary

Actions

To complete the unbundling of Eskom and setting up of a generation company

Are there plans?

To complete the unbundling of Eskom

Is it on the agenda?

The distribution company has recently been legally separated from Eskom but it is not yet operational and has not been unbundled from Eskom.

Goals

To have a separate distribution company from Eskom

Documents

References

Departments / Govt Institutions

Department of Electricity and Energy Eskom Holdings

Summary

Distribution’s role is to service the customer through building, operating and maintaining Distribution assets, while also acting in the national interest by actively partnering with the wider industry in resolving Distribution industry issues and enhancing stakeholder relations.

Canvas not supported.

Is it working?

To be determined. The distribution company has only been legally unbundled but it has not been officially set up as a subsidiary

Actions

To complete the unbundling of Eskom and setting up of a generation company

Are there plans?

To complete the unbundling of Eskom

Is it on the agenda?

The distribution company has recently been legally separated from Eskom but it is not yet operational and has not been unbundled from Eskom.

Goals

To have a separate distribution company from Eskom

Documents

References

Departments / Govt Institutions

Department of Electricity and Energy Eskom Holdings

Summary

Distribution’s role is to service the customer through building, operating and maintaining Distribution assets, while also acting in the national interest by actively partnering with the wider industry in resolving Distribution industry issues and enhancing stakeholder relations.

Canvas not supported.

Is it working?

To be determined. The distribution company has only been legally unbundled but it has not been officially set up as a subsidiary

Actions

To complete the unbundling of Eskom and setting up of a generation company

Are there plans?

To complete the unbundling of Eskom

Is it on the agenda?

The distribution company has recently been legally separated from Eskom but it is not yet operational and has not been unbundled from Eskom.

Goals

To have a separate distribution company from Eskom

Documents

References

Departments / Govt Institutions

Department of Electricity and Energy Eskom Holdings

Summary

Distribution’s role is to service the customer through building, operating and maintaining Distribution assets, while also acting in the national interest by actively partnering with the wider industry in resolving Distribution industry issues and enhancing stakeholder relations.

Canvas not supported.

Is it working?

To be determined. The distribution company has only been legally unbundled but it has not been officially set up as a subsidiary

Actions

To complete the unbundling of Eskom and setting up of a generation company

Are there plans?

To complete the unbundling of Eskom

Is it on the agenda?

The distribution company has recently been legally separated from Eskom but it is not yet operational and has not been unbundled from Eskom.

Goals

To have a separate distribution company from Eskom

Documents

References

Departments / Govt Institutions

Department of Electricity and Energy Eskom Holdings

Summary

Distribution’s role is to service the customer through building, operating and maintaining distribution assets, while also acting in the national interest by actively partnering with the wider industry in resolving distribution industry issues and enhancing stakeholder relations.

Canvas not supported.

Is it working?

The unbundling has a long way to go and progress appears slow. The distribution company has only been functionally unbundled but it has not been officially set up as a subsidiary. Monde Bala, its group executive was recently seconded to the NTCSA and now Agnes Mlambo is acting head of distribution.

Actions

The process has begun to legally separate but the distribution company but it is still part of Eskom. Then passing of the ERA should also provide further impetus for the unbundling. A big hurdle to overcome is rising municipal debt of roughly R100 billion, which ultimately affects the distribution business and risks it being able to raise further investment. Addressing municipal debt requires working with Treasury to put in place broad strutural changes and potentially legislative reform. Eskom is set to apply for a distribution licence from Nersa as part of its plans to legally separate its Distribution division. The minister will play a key role by appointing a permanent board of directors for Disco. Eskom’s management willmfocus on completing all necessary preparations for the transfer of staff, systems and assets to the newly separated entity, ensuring a smooth and efficient transition.

Are there plans?

Full unbundling still to take place; the distribution company has been functionally separated from Eskom - with separate management and internal accounting structures - but it is not yet operational and has not been unbundled from Eskom.

Is it on the agenda?

Part of the overall energy system reforms. Operation Vulindlela and Necom plan to prioritise distribution reform, though this process is likely to take time.

Goals

To separate the distribution division from Eskom, it will be a subsidiary to the holding company.

Documents

References

Departments / Govt Institutions

Department of Electricity and Energy Eskom Holdings

Summary

Distribution’s role is to service the customer through building, operating and maintaining distribution assets, while also acting in the national interest by actively partnering with the wider industry in resolving distribution industry issues and enhancing stakeholder relations.

Canvas not supported.

Is it working?

The unbundling has a long way to go and progress appears slow. The distribution company has only been functionally unbundled but it has not been officially set up as a subsidiary. Monde Bala, its group executive was recently seconded to the NTCSA and now Agnes Mlambo is acting head of distribution.

Actions

The process has begun to legally separate but the distribution company but it is still part of Eskom. Then passing of the ERA should also provide further impetus for the unbundling. A big hurdle to overcome is rising municipal debt of roughly R100 billion, which ultimately affects the distribution business and risks it being able to raise further investment. Addressing municipal debt requires working with Treasury to put in place broad strutural changes and potentially legislative reform. Eskom is set to apply for a distribution licence from Nersa as part of its plans to legally separate its Distribution division. The minister will play a key role by appointing a permanent board of directors for Disco. Eskom’s management willmfocus on completing all necessary preparations for the transfer of staff, systems and assets to the newly separated entity, ensuring a smooth and efficient transition.

Are there plans?

Full unbundling still to take place; the distribution company has been functionally separated from Eskom - with separate management and internal accounting structures - but it is not yet operational and has not been unbundled from Eskom.

Is it on the agenda?

Part of the overall energy system reforms. Operation Vulindlela and Necom plan to prioritise distribution reform, though this process is likely to take time.

Goals

To separate the distribution division from Eskom, it will be a subsidiary to the holding company.

Documents

References

Departments / Govt Institutions

Department of Electricity and Energy Eskom Holdings

Summary

The process has begun to legally separate the distribution company, but it is still part of Eskom. The passing of the Electricity Regulation Amendment Act should also provide further impetus for the unbundling. A big hurdle to overcome is rising municipal debt of roughly R105bn, which is also hindering the unbundling process.

Canvas not supported.

Is it working?

The unbundling has a long way to go and progress appears slow. The distribution company has been only functionally unbundled, it has not been officially set up as a subsidiary. Monde Bala, its group executive, was appointed to lead NTCSA and now Agnes Mlambo is acting head of distribution.

Actions

Addressing municipal debt requires working with Treasury to put in place broad structural changes and potentially legislative reform. Eskom, with the backing of the Department of Electricity and Energy, Treasury and the Department of Cooperative Governance and Traditional Affairs, will implement distribution agency agreements (DAA) as an interim measure to arrest or prevent future municipal arrears. The DAAs essentially see Eskom take over electricity service delivery, billing, revenue collection and credit control for municipalities, which will maintain their electricity distribution licences.The long-term solution for municipal financial sustainability and stability is the Electricity Distribution Industry (EDI) reform process led by Operation Vulindlela.Other actions include Eskom applying for a distribution licence from Nersa as part of its plans to legally separate its Distribution division. The minister will play a key role by appointing a permanent board of directors for the entity.

Are there plans?

Full unbundling is still to take place, with the focus having been on the unbundling of the National Transmission Company of South Africa.
rnThere are plans in place to address municipal debt through EDI reform and Eskom's DAAs with municipalities.
rnIn December 2025 the Department of Electricity and Energy approved Eskom's revised unbundling strategy - in a statement Eskom similarly highlighted that municipal debt must be resolved in order to establish the National Electricity Distribution Company of South Africa.

Is it on the agenda?

Eskom distribution's unbundling is part of the overall energy system reforms. Operation Vulindlela and the National Energy Crisis Committee (Necom) are working on distribution reform, though this process is likely to take time.

Goals

To separate the distribution division from Eskom; it will be a subsidiary to the holding company.

Documents

References

Departments / Govt Institutions

Department of Electricity and Energy Eskom Holdings

Summary

The process has begun to legally separate the distribution company, but it is still part of Eskom. The passing of the Electricity Regulation Amendment Act should also provide further impetus for the unbundling. A big hurdle to overcome is rising municipal debt of roughly R105bn, which is also hindering the unbundling process.

Canvas not supported.

Is it working?

The unbundling has a long way to go and progress appears slow. The distribution company has been only functionally unbundled, it has not been officially set up as a subsidiary. Monde Bala, its group executive, was appointed to lead NTCSA and now Agnes Mlambo is acting head of distribution.

Actions

A cabinet-endorsed roadmap outlining the end-state of Eskom's balance sheet and capital structure is critical to the unbundling process.Focusing on distribution - addressing municipal debt requires working with Treasury to put in place broad structural changes and potentially legislative reform. Eskom, with the backing of the Department of Electricity and Energy, Treasury and the Department of Cooperative Governance and Traditional Affairs, will implement distribution agency agreements (DAA) as an interim measure to arrest or prevent future municipal arrears. The DAAs essentially see Eskom take over electricity service delivery, billing, revenue collection and credit control for municipalities, which will maintain their electricity distribution licences.The long-term solution for municipal financial sustainability and stability is the Electricity Distribution Industry (EDI) reform process led by Operation Vulindlela.Other actions include Eskom applying for a distribution licence from Nersa as part of its plans to legally separate its Distribution division. The minister will play a key role by appointing a permanent board of directors for the entity.

Are there plans?

Full unbundling is still to take place, with the focus having been on the unbundling of the National Transmission Company of South Africa.There are plans in place to address municipal debt through EDI reform and Eskom's DAAs with municipalities.In December 2025 the Department of Electricity and Energy approved Eskom's revised unbundling strategy - in a statement Eskom similarly highlighted that municipal debt must be resolved in order to establish the National Electricity Distribution Company of South Africa.

Is it on the agenda?

Eskom distribution's unbundling is part of the overall energy system reforms. Operation Vulindlela and the National Energy Crisis Committee (Necom) are working on distribution reform, though this process is likely to take time.

Goals

To separate the distribution division from Eskom; it will be a subsidiary to the holding company.

Documents

References

Departments / Govt Institutions

Department of Electricity and Energy Eskom Holdings

Analyst: Lameez Hyman
Status: in-progress
Last Updated:
Next Update:
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Reform Area:
Reform:

    If you would like to alert our analysts to an update you are aware of in this particular reform area, please complete the form below and submit it to us. Please ensure you include links to any press releases or other documents to confirm the reforms and provide detail to allow our analysts to assess the changes. Our team will review it.

    Eskom Generation company unbundling

    Summary

    Canvas not supported.

    Is it working?

    Not yet

    Actions

    To complete the unbundling of Eskom and setting up of a generation company

    Are there plans?

    To complete the unbundling of Eskom

    Is it on the agenda?

    The generation company has recently been legally separated from Eskom but it is not yet operational and has not been unbundled from Eskom

    Goals

    To have the a separate generation company from Eskom

    Documents

    References

    Departments / Govt Institutions

    Department of Electricity and Energy Eskom Holdings

    Summary

    As part of the unbundling Eskom into three divisions:transmission, distribution and generation ; the generation company will be separated from the Eskom holding company.

    Canvas not supported.

    Is it working?

    Not yet

    Actions

    To complete the unbundling of Eskom and setting up of a generation company

    Are there plans?

    To complete the unbundling of Eskom

    Is it on the agenda?

    The generation company has recently been legally separated from Eskom but it is not yet operational and has not been unbundled from Eskom.

    Goals

    To have the a separate generation company from Eskom

    Documents

    References

    Departments / Govt Institutions

    Department of Electricity and Energy Eskom Holdings

    Summary

    This forms part of the overall plan to unbundle Eskom into three divisions: transmission, distribution and generation. The generation company will be separated from the Eskom holding company.

    Canvas not supported.

    Is it working?

    Incomplete.

    Actions

    Process has begun with the legal separation but the generation company is still part of Eskom.

    Are there plans?

    To complete the unbundling of Eskom.

    Is it on the agenda?

    The generation company has recently been legally separated from Eskom but it is not yet operational and has not been unbundled from Eskom.

    Goals

    To establish Eskom Generation as a separate business from Eskom.

    Documents

    References

    Departments / Govt Institutions

    Department of Electricity and Energy Eskom Holdings

    Summary

    This forms part of the overall plan to unbundle Eskom into three divisions: transmission, distribution and generation. The generation company will be separated from the Eskom holding company.

    Canvas not supported.

    Is it working?

    Incomplete.

    Actions

    Process has begun with the legal separation but the generation company is still part of Eskom.

    Are there plans?

    To complete the unbundling of Eskom.

    Is it on the agenda?

    The generation company has recently been legally separated from Eskom but it is not yet operational and has not been unbundled from Eskom.

    Goals

    To establish Eskom Generation as a separate business from Eskom.

    Documents

    References

    Departments / Govt Institutions

    Department of Electricity and Energy Eskom Holdings

    Summary

    This forms part of the overall plan to unbundle Eskom into three divisions: transmission, distribution and generation. The generation company will be separated from the Eskom holding company.

    Canvas not supported.

    Is it working?

    Incomplete.

    Actions

    Process has begun with the legal separation but the generation company is still part of Eskom.

    Are there plans?

    To complete the unbundling of Eskom.

    Is it on the agenda?

    The generation company has recently been legally separated from Eskom but it is not yet operational and has not been unbundled from Eskom.

    Goals

    To establish Eskom Generation as a separate business from Eskom.

    Documents

    References

    Departments / Govt Institutions

    Department of Electricity and Energy Eskom Holdings

    Summary

    This forms part of the overall plan to unbundle Eskom into three divisions: transmission, distribution and generation. The generation company will be separated from the Eskom holding company.

    Canvas not supported.

    Is it working?

    Incomplete.

    Actions

    Process has begun with the legal separation but the generation company is still part of Eskom.

    Are there plans?

    To complete the unbundling of Eskom.

    Is it on the agenda?

    The generation company has recently been functionally separated from Eskom but is not yet operational and has not been unbundled from Eskom.

    Goals

    To establish Eskom Generation as a separate business from Eskom.

    Documents

    References

    Departments / Govt Institutions

    Department of Electricity and Energy Eskom Holdings

    Summary

    This forms part of the overall plan to unbundle Eskom into three divisions: transmission, distribution and generation. The generation company will be separated from the Eskom holding company.

    Canvas not supported.

    Is it working?

    The unbundling is not complete, and timelines are not clear.

    Actions

    Process has begun with the legal separation but the generation company is still part of Eskom. The passing of the ERA Act also will help provide momentum for the unbundling process. Eskom has also appointed a new group executive for renewables, Rivoningo Mnisi and has also launched tenders for new renewable energy plants and green hydrogen.

    Are there plans?

    The generation business has set ambitious targets, including establishing a renewable energy generation department, but it is still unclear how this will be achieved. The due diligence process for legal separation was successfully concluded by Eskom and was submitted to the Department of Public Enterprises for consideration, marking a significant step towards restructuring and operational independence. However, following the dissolution of the Department of Public Enterprises, it is unclear whether this step was approved or is being considered by the Electricity and Energy Department since it is now a major Eskom shareholder.

    Is it on the agenda?

    The generation company has been functionally separated from Eskom - with separate internal accounting and management structures- but is not yet operational and has not been unbundled from Eskom.

    Goals

    To establish Eskom Generation as a separate business from Eskom, but it will remain a subsidiary of the holding company.

    Documents

    References

    Departments / Govt Institutions

    Department of Electricity and Energy Eskom Holdings

    Summary

    Eskom intends to unbundle into four divisions, including transmission, distribution, generation and a new renewable energy entity, Eskom Green. GenerationCo or (GxCo) is yet to be fully unbundled, with a separate board.

    Canvas not supported.

    Is it working?

    The unbundling is not complete. The generation company has been functionally separated from Eskom, with separate internal accounting and management structures, but is not yet fully unbundled from Eskom.

    Actions

    A cabinet-endorsed roadmap outlining Eskom's end state across operations, balance sheet and functions is needed to inform the unbundling process, as well as identify responsible actors. For Eskom Generation, its legal form and financial sustainability must be resolved, especially in the face of coal powerplants that will be decommissioned.The future establishment of Eskom Green, its mandate and funding and how it fits in the Eskom end-state, must also be clarified. For now, there is no clear backing across government for it and it also has raised competition and grid access concerns.

    Are there plans?

    Electricity and Energy Minister Kgosientsho Ramokgopa in December 2025 approved a revised unbundling strategy which reaffirms the establishment of GenerationCo by 2030. It's unclear however if the unbundling strategy still stands, as President Cyril Ramaphosa overruled the unbundling of transmission entity aspect which also forms part of the strategy.
    rn

    Is it on the agenda?

    Eskom is following a revised unbundling strategy, that seeks to unbundle GxCo by 2030. GxCo's unbundling forms part of a greater Eskom restructuring set out in 2019, and was re-emphasised in President Cyril Ramaphosa's State of the Nation Address.

    Goals

    To establish Eskom Generation (GxCo) as a separate business from Eskom. It will remain a subsidiary of the holding company.

    Documents

    References

    Departments / Govt Institutions

    Department of Electricity and Energy Eskom Holdings

    Summary

    Eskom intends to unbundle into four divisions, including transmission, distribution, generation and a new renewable energy entity, Eskom Green. GenerationCo or (GxCo) is yet to be fully unbundled, with a separate board.

    Canvas not supported.

    Is it working?

    The unbundling is not complete. The generation company has been functionally separated from Eskom, with separate internal accounting and management structures, but is not yet fully unbundled from Eskom.

    Actions

    A cabinet-endorsed roadmap outlining Eskom's end state across operations, balance sheet and functions is needed to inform the unbundling process, as well as identify responsible actors. For Eskom Generation, its legal form and financial sustainability must be resolved, especially in the face of coal powerplants that will be decommissioned.The future establishment of Eskom Green, its mandate and funding and how it fits in the Eskom end-state, must also be clarified. For now, there is no clear backing across government for it and it also has raised competition and grid access concerns.

    Are there plans?

    Electricity and Energy Minister Kgosientsho Ramokgopa in December 2025 approved a revised unbundling strategy which reaffirms the establishment of GenerationCo by 2030. It's unclear however if the unbundling strategy still stands, as President Cyril Ramaphosa overruled the unbundling of transmission entity aspect which also forms part of the strategy.

    Is it on the agenda?

    Eskom is following a revised unbundling strategy, that seeks to unbundle GxCo by 2030. GxCo's unbundling forms part of a greater Eskom restructuring set out in 2019, and was re-emphasised in President Cyril Ramaphosa's State of the Nation Address.

    Goals

    To establish Eskom Generation (GxCo) as a separate business from Eskom. It will remain a subsidiary of the holding company.

    Documents

    References

    Departments / Govt Institutions

    Department of Electricity and Energy Eskom Holdings

    Analyst: Lameez Hyman
    Status: in-progress
    Last Updated:
    Next Update:
    Got an Update? Follow this reform
    Reform Area:
    Reform:

      If you would like to alert our analysts to an update you are aware of in this particular reform area, please complete the form below and submit it to us. Please ensure you include links to any press releases or other documents to confirm the reforms and provide detail to allow our analysts to assess the changes. Our team will review it.