No data available for the deliverable: Curtailment protocol
No data available for the deliverable: Curtailment protocol
No data available for the deliverable: Curtailment protocol
No data available for the deliverable: Curtailment protocol
No data available for the deliverable: Curtailment protocol
No data available for the deliverable: Curtailment protocol
Summary
The curtailment framework was approved by Nersa in April 2025. The process began on 28 January 2024 when Eskom released an addendum on the Generation Connection Capacity Assessment (GCCA). The GCCA 2025 Addendum provides the 2025 connection capacity with curtailment for energy generators and indicates the additional capacity that has been made available in the Eastern Cape and Western Cape through curtailment. In October 2025, the National Transmission Company of South Africa (NTCSA) said that the 4% share of curtailment allowed by Nersa would free up 1,580MW of grid capacity in the provinces (1,180MW in the Western Cape and 400MW in the Eastern Cape).
View DetailsIs it working?
Effectiveness to be determined once curtailment allocations are made. Only wind projects in the Eastern and Western Cape provinces will qualify.
Actions
The curtailment framework was approved by Nersa in April 2025. It provides for a compensation mechanism for independent power projects that had to scale back output.
The NTCSA held a workshop for IPPs on how curtailment would work. It also issued a practice note. NTCSA CEO Monde Bala told delegates that the entity would start with the allocation process from November 2025 and would report to Nersa every six months (over the three-year period) about the implementation of congestion curtailment.
Are there plans?
No further plans; the curtailment framework was approved by Nersa and applies from 1 April 2025 to 31 March 2028. If grid capacity constraints persist, the NTCSA plans to apply to the regulator to allow for more curtailment.
Is it on the agenda?
Yes, the NTCSA applied to Nersa which granted approval.
Goals
Curtailment framework to be put in place to provide additional grid capacity to connect new generation projects.
Documents
Departments / Govt Institutions
Department of Electricity and Energy National Transmission Company of South Africa
Summary
The curtailment framework was approved by Nersa in April 2025. The process began on 28 January 2024 when Eskom released an addendum on the Generation Connection Capacity Assessment (GCCA). The GCCA 2025 Addendum provides the 2025 connection capacity with curtailment for energy generators and indicates the additional capacity that has been made available in the Eastern Cape and Western Cape through curtailment. In October 2025, the National Transmission Company of South Africa (NTCSA) said that the 4% share of curtailment allowed by Nersa would free up 1,580MW of grid capacity in the provinces (1,180MW in the Western Cape and 400MW in the Eastern Cape).
View DetailsIs it working?
Effectiveness to be determined once curtailment allocations are made. Only wind projects in the Eastern and Western Cape provinces will qualify.
Actions
The curtailment framework was approved by Nersa in April 2025. It provides for a compensation mechanism for independent power projects that had to scale back output.
The NTCSA held a workshop for IPPs on how curtailment would work. It also issued a practice note. NTCSA CEO Monde Bala told delegates that the entity would start with the allocation process from November 2025 and would report to Nersa every six months (over the three-year period) about the implementation of congestion curtailment.
Are there plans?
No further plans; the curtailment framework was approved by Nersa and applies from 1 April 2025 to 31 March 2028. If grid capacity constraints persist, the NTCSA plans to apply to the regulator to allow for more curtailment.
Is it on the agenda?
Yes, the NTCSA applied to Nersa which granted approval.
Goals
Curtailment framework to be put in place to provide additional grid capacity to connect new generation projects.
Documents
Departments / Govt Institutions
Department of Electricity and Energy National Transmission Company of South Africa
Summary
Curtailment is implemented when the electricity System Operator instructs generators to reduce their output to maintain system stability. Curtailment has also been put in place to deal with network constraints, for example, to make available grid capacity in the Eastern and Western Cape provinces, the National Transmission Company South Africa (NTCSA) applied to implement a curtailment framework that was approved by the National Energy Regulator of South Africa (Nersa) in April 2025. In October 2025, the NTCSA said that the 4% share of curtailment allowed by Nersa would free up 1,580MW of grid capacity in the provinces (1,180MW in the Western Cape and 400MW in the Eastern Cape). There have been no progress updates on the approved curtailment framework's implementation as at June 2026.
Reports however indicated that there have been challenges with regard to existing curtailment arrangements, with the NTCSA facing a backlog of R2bn in compensation payments to independent power producers (IPPs). This has resulted in revenue shortfalls and posing risk to the bankability of future renewable energy projects.
Is it working?
The effectiveness of the 4% curtailment framework is yet to be determined. Only wind projects in the Eastern and Western Cape provinces will qualify.
Existing curtailment arrangements face a setback with the NTCSA indicating a backlog of R2bn in compensation payments to IPPs that have reduced their generation output, effectively resulting in revenue shortfalls. Concerns have been raised around the transparency of the curtailment methodology in place. It speaks to broader planning and execution issues on the part of the NTCSA and distribution system operators that need to be corrected.
The issue points to the need to deploy battery energy storage to assist in maintaining system stability as opposed to implementing curtailment.
Actions
The NTCSA must provide a progress update on the implementation of the 4% curtailment framework in the Western Cape and Eastern Cape.
To deal with the payment backlog of existing curtailment arrangements, the NTCSA is deploying more resources and improving processes.
The NTCSA needs to provide more transparency on the curtailment implementation process, which should be provided in its six-month reports to Nersa.
There is a need to look into battery energy storage as a more productive investment case to maintain system stability as opposed to curtailment. A grid resilience analysis process the Energy Council of South Africa is leading should provide more insights and direction in this regard.
Are there plans?
No further plans; if grid capacity constraints persist, the NTCSA plans to apply to the regulator to allow for more curtailment.
Is it on the agenda?
Yes, the NTCSA applied to Nersa which granted approval for the 4% curtailment framework. The NTCSA continues to implement curtailment to maintain system stability.
Goals
Curtailment framework to be put in place to provide additional grid capacity to connect new generation projects.
Documents
Departments / Govt Institutions
Department of Electricity and Energy National Transmission Company of South Africa
Summary
Curtailment is implemented when the electricity System Operator instructs generators to reduce their output to maintain system stability. Curtailment has also been put in place to deal with network constraints, for example, to make available grid capacity in the Eastern and Western Cape provinces, the National Transmission Company South Africa (NTCSA) applied to implement a curtailment framework that was approved by the National Energy Regulator of South Africa (Nersa) in April 2025. In October 2025, the NTCSA said that the 4% share of curtailment allowed by Nersa would free up 1,580MW of grid capacity in the provinces (1,180MW in the Western Cape and 400MW in the Eastern Cape). There have been no progress updates on the approved curtailment framework's implementation as at June 2026.
Reports however indicated that there have been challenges with regard to existing curtailment arrangements, with the NTCSA facing a backlog of R2bn in compensation payments to independent power producers (IPPs). This has resulted in revenue shortfalls and posing risk to the bankability of future renewable energy projects.
Is it working?
The effectiveness of the 4% curtailment framework is yet to be determined. Only wind projects in the Eastern and Western Cape provinces will qualify.
Existing curtailment arrangements face a setback with the NTCSA indicating a backlog of R2bn in compensation payments to IPPs that have reduced their generation output, effectively resulting in revenue shortfalls. Concerns have been raised around the transparency of the curtailment methodology in place. It speaks to broader planning and execution issues on the part of the NTCSA and distribution system operators that need to be corrected.
The issue points to the need to deploy battery energy storage to assist in maintaining system stability as opposed to implementing curtailment.
Actions
The NTCSA must provide a progress update on the implementation of the 4% curtailment framework in the Western Cape and Eastern Cape.
To deal with the payment backlog of existing curtailment arrangements, the NTCSA is deploying more resources and improving processes.
The NTCSA needs to provide more transparency on the curtailment implementation process, which should be provided in its six-month reports to Nersa.
There is a need to look into battery energy storage as a more productive investment case to maintain system stability as opposed to curtailment. A grid resilience analysis process the Energy Council of South Africa is leading should provide more insights and direction in this regard.
Are there plans?
No further plans; if grid capacity constraints persist, the NTCSA plans to apply to the regulator to allow for more curtailment.
Is it on the agenda?
Yes, the NTCSA applied to Nersa which granted approval for the 4% curtailment framework. The NTCSA continues to implement curtailment to maintain system stability.
Goals
Curtailment framework to be put in place to provide additional grid capacity to connect new generation projects.
Documents
Departments / Govt Institutions
Department of Electricity and Energy National Transmission Company of South Africa
Summary
On 28 January 2024, Eskom released an addendum on the GCCA. The GCCA 2025 Addendum provides the 2025 connection capacity with curtailment for energy generators and serves as an addendum to the GCCA 2025 published in October 2023, for the purpose of indicating additional capacity that has been made available in the Eastern Cape and Western Cape under curtailment. By accepting a reasonable share of no more than 10% of curtailment, 3,470MW of additional generation capacity can be connected to the grid almost immediately, with 2,680MW in the Western Cape and 790MW in the Eastern Cape,
View DetailsIs it working?
To be determined
Actions
Release of the curtailment framework and GCCA addendum.
Are there plans?
To obtain the framework approval from Nersa.
Is it on the agenda?
Yes
Goals
Curtailment framework to provide additional grid capacity, potentially salvaging BW7.
Departments / Govt Institutions
Summary
On 28 January 2024, Eskom released an addendum on the GCCA. The GCCA 2025 Addendum provides the 2025 connection capacity with curtailment for energy generators and serves as an addendum to the GCCA 2025 published in October 2023, for the purpose of indicating additional capacity that has been made available in the Eastern Cape and Western Cape under curtailment. By accepting a reasonable share of no more than 10% of curtailment, 3,470MW of additional generation capacity can be connected to the grid almost immediately, with 2,680MW in the Western Cape and 790MW in the Eastern Cape,
View DetailsIs it working?
To be determined
Actions
Release of the curtailment framework and GCCA addendum.
Are there plans?
To obtain the framework approval from Nersa.
Is it on the agenda?
Yes
Goals
Curtailment framework to provide additional grid capacity, potentially salvaging BW7.
Departments / Govt Institutions
Summary
The decision on the curtailment was expected to be delivered in November 2024. Nersa has completed public hearings following the release of curtailment framework for public comments in July 2024. The process began on 28 January 2024 when Eskom released an addendum on the GCCA. The GCCA 2025 Addendum provides the 2025 connection capacity with curtailment for energy generators and serves as an addendum to the GCCA 2025 published in October 2023, for the purpose of indicating additional capacity that has been made available in the Eastern Cape and Western Cape under curtailment. By accepting a reasonable share of no more than 10% of curtailment, 3,470MW of additional generation capacity can be connected to the grid almost immediately, with 2,680MW in the Western Cape and 790MW in the Eastern Cape.
View DetailsIs it working?
Not yet in place, effectiveness to be determined.
Actions
Release of the curtailment framework for public comments.
Are there plans?
In process - to obtain the framework approval from Nersa.
Is it on the agenda?
Yes
Goals
Curtailment framework to provide additional grid capacity, potentially salvaging BW7.
Departments / Govt Institutions
Summary
The decision on the curtailment was expected to be delivered in November 2024. Nersa has completed public hearings following the release of curtailment framework for public comments in July 2024. The process began on 28 January 2024 when Eskom released an addendum on the GCCA. The GCCA 2025 Addendum provides the 2025 connection capacity with curtailment for energy generators and serves as an addendum to the GCCA 2025 published in October 2023, for the purpose of indicating additional capacity that has been made available in the Eastern Cape and Western Cape under curtailment. By accepting a reasonable share of no more than 10% of curtailment, 3,470MW of additional generation capacity can be connected to the grid almost immediately, with 2,680MW in the Western Cape and 790MW in the Eastern Cape.
View DetailsIs it working?
Not yet in place, effectiveness to be determined.
Actions
Release of the curtailment framework for public comments.
Are there plans?
In process - to obtain the framework approval from Nersa.
Is it on the agenda?
Yes
Goals
Curtailment framework to provide additional grid capacity, potentially salvaging BW7.
Departments / Govt Institutions
Summary
The decision on the curtailment was expected to be delivered in November 2024. Nersa has completed public hearings following the release of curtailment framework for public comments in July 2024. The process began on 28 January 2024 when Eskom released an addendum on the GCCA. The GCCA 2025 Addendum provides the 2025 connection capacity with curtailment for energy generators and serves as an addendum to the GCCA 2025 published in October 2023, for the purpose of indicating additional capacity that has been made available in the Eastern Cape and Western Cape under curtailment. By accepting a reasonable share of no more than 10% of curtailment, 3,470MW of additional generation capacity can be connected to the grid almost immediately, with 2,680MW in the Western Cape and 790MW in the Eastern Cape.
View DetailsIs it working?
Not yet in place, effectiveness to be determined.
Actions
Release of the curtailment framework for public comments.
Are there plans?
In process - to obtain the framework approval from Nersa.
Is it on the agenda?
Yes
Goals
Curtailment framework to provide additional grid capacity, potentially salvaging BW7.
Departments / Govt Institutions
Summary
To facilitate private investments and development of transmission infrastructure, an office similar to the IPPO needs to be established. This will be known as the Independent Transmission Project Office.
View DetailsIs it working?
Not yet in effect.
Actions
The draft concept paper to establish the ITPO is expected to be submitted to Cabinet for approval in 2025/26. Thereafter the ITPO will be established.
Are there plans?
According to Electricity Minister Kgosientsho Ramokgopa, the government intends to establish an independent transmission project office, which will be located at either the Development Bank of Southern Africa (DBSA) or the Industrial Development Corporation (IDC), to procure new transmission capacity under a build, operate and transfer (BOT) model.
Is it on the agenda?
Plans have been announced but an ITP office not yet established.
Goals
An Independent Transmission Project Office will be formed to procure new transmission capacity. It will function as the Independent Power Producer Procurement Office did to procure generation capacity from the private sector.
Departments / Govt Institutions
Summary
To facilitate private investments and development of transmission infrastructure, an office similar to the Independent Power Producer Office was to be established. This will be known as the Independent Transmission Project Office. The Department of Electricity and Energy, which is leading the process, told parliament's portfolio committee on electricity and energy in November 2025 that it had not completed stakeholder engagements on a concept paper for the ITP office. The department instead intends to assess the outcomes of the first bid window of the ITP procurement programme, being facilitated by the IPP Office. This will help the department determine if a separate ITP office must be established, or if a single, consolidated energy infrastructure procurement office would be preferable.
Is it working?
Not yet in effect and subject to re-evaluation based on the outcomes of the first bid window of the ITP procurement programme facilitated by the IPP Office.
Actions
The draft concept paper to establish the ITPO was expected to be submitted to Cabinet for approval in 2025/26, but the department of Electricity and Energy decided not to go ahead with a stakeholder consultation process on the paper, pending the outcomes of the first bid window of the ITP procurement programme.
For this reason, the first bid window of the ITP procurement programme must run its course.
The department is also working on a five- to 10-year pipeline detailing the frequency of future bid windows and how the programme will work. This is due to be released in the first quarter of 2026.
Are there plans?
Electricity Minister Kgosientsho Ramokgopa previously indicated the government intends to establish an ITP Office, which will be located at either the Development Bank of Southern Africa (DBSA) or the Industrial Development Corporation (IDC), to procure new transmission capacity under a build, operate and transfer (BOT) model. But this is subject to evaluation. Currently the ITP programme is being facilitated by the IPP Office.
rnA team within the department is also working on a pipeline for future bid windows of the ITP programme, which may also inform a decision to move forward with the ITP Office or not.
Is it on the agenda?
Plans were announced, but this is subject to an evaluation by the Department of Electricity and Energy based on the outcomes of the first bid window of the ITP procurement programme. The ITP Office has not been established. However the IPP Office is conducting the first bid window of the ITP procurement programme.
Goals
An Independent Transmission Project Office will be formed to procure new transmission capacity. It will function as the Independent Power Producer Procurement (IPP) Office did to procure generation capacity from the private sector.
Departments / Govt Institutions
Summary
To facilitate private investments and development of transmission infrastructure, an office similar to the Independent Power Producer Office is to be established. This will be known as the Independent Transmission Project Office. The Department of Electricity and Energy, which is leading the process, told parliament's portfolio committee on electricity and energy in November 2025 that it had not completed stakeholder engagements on a concept paper for the ITP office. The department instead intends to assess the outcomes of the first bid window of the ITP procurement programme, being facilitated by the IPP Office. This will help the department determine if a separate ITP office must be established, or if a single, consolidated energy infrastructure procurement office would be preferable.
View DetailsIs it working?
Not yet in effect and subject to re-evaluation based on the outcomes of the first bid window of the ITP procurement programme facilitated by the IPP Office.
Actions
The draft concept paper to establish the ITPO was expected to be submitted to Cabinet for approval in 2025/26, but the department of Electricity and Energy decided not to go ahead with a stakeholder consultation process on the paper, pending the outcomes of the first bid window of the ITP procurement programme.
For this reason, the first bid window of the ITP procurement programme must run its course.
The department is also working on a five- to 10-year pipeline detailing the frequency of future bid windows and how the programme will work. This is due to be released in the first quarter of 2026.
Are there plans?
Electricity Minister Kgosientsho Ramokgopa previously indicated the government intends to establish an ITP Office, which will be located at either the Development Bank of Southern Africa (DBSA) or the Industrial Development Corporation (IDC), to procure new transmission capacity under a build, operate and transfer (BOT) model. But this is subject to evaluation. Currently the ITP programme is being facilitated by the IPP Office.
rnA team within the department is also working on a pipeline for future bid windows of the ITP programme, which may also inform a decision to move forward with the ITP Office or not.
Is it on the agenda?
Plans were announced, but this is subject to an evaluation by the Department of Electricity and Energy based on the outcomes of the first bid window of the ITP procurement programme. The ITP Office has not been established. However the IPP Office is conducting the first bid window of the ITP procurement programme.
Goals
An Independent Transmission Project Office will be formed to procure new transmission capacity. It will function as the Independent Power Producer Procurement (IPP) Office did to procure generation capacity from the private sector.
Departments / Govt Institutions
Summary
To facilitate private investments and development of transmission infrastructure, an office similar to the Independent Power Producer Office is to be established. This will be known as the Independent Transmission Project Office. The Department of Electricity and Energy, which is leading the process, told parliament's portfolio committee on electricity and energy in November 2025 that it had not completed stakeholder engagements on a concept paper for the ITP office. The department instead intends to assess the outcomes of the first bid window of the ITP procurement programme, being facilitated by the IPP Office. This will help the department determine if a separate ITP office must be established, or if a single, consolidated energy infrastructure procurement office would be preferable.
View DetailsIs it working?
Not yet in effect and subject to re-evaluation based on the outcomes of the first bid window of the ITP procurement programme facilitated by the IPP Office.
Actions
The draft concept paper to establish the ITPO was expected to be submitted to Cabinet for approval in 2025/26, but the Department of Electricity and Energy decided not to go ahead with a stakeholder consultation process on the paper, pending the outcomes of the first bid window of the ITP procurement programme.
For this reason, the first bid window of the ITP procurement programme must run its course.
The department is also working on a five- to 10-year pipeline detailing the frequency of future bid windows and how the programme will work. This was meant to be released in the first quarter of 2026 but has been delayed.
Are there plans?
Electricity minister Kgosientsho Ramokgopa previously indicated that the government intends to establish an ITP Office, which will be located at either the Development Bank of Southern Africa (DBSA) or the Industrial Development Corporation (IDC), to procure new transmission capacity under a build, operate and transfer (BOT) model. But this is subject to evaluation. Currently the ITP programme is being facilitated by the IPP Office.
A team within the department is also developing a pipeline for future bid windows under the ITP programme, which may help inform the decision on whether to proceed with the ITP Office.
Is it on the agenda?
Plans were announced, but this is subject to an evaluation by the Department of Electricity and Energy based on the outcomes of the first bid window of the ITP procurement programme. The ITP Office has not been established. However the IPP Office is conducting the first bid window of the ITP procurement programme.
Goals
An Independent Transmission Project Office will be established to procure new transmission capacity. It will perform a role similar to that of the IPP Office in procuring generation capacity from the private sector.
Departments / Govt Institutions
Summary
To facilitate private investments and development of transmission infrastructure, an office similar to the Independent Power Producer Office is to be established. This will be known as the Independent Transmission Project Office. The Department of Electricity and Energy, which is leading the process, told parliament's portfolio committee on electricity and energy in November 2025 that it had not completed stakeholder engagements on a concept paper for the ITP office. The department instead intends to assess the outcomes of the first bid window of the ITP procurement programme, being facilitated by the IPP Office. This will help the department determine if a separate ITP office must be established, or if a single, consolidated energy infrastructure procurement office would be preferable.
View DetailsIs it working?
Not yet in effect and subject to re-evaluation based on the outcomes of the first bid window of the ITP procurement programme facilitated by the IPP Office.
Actions
The draft concept paper to establish the ITPO was expected to be submitted to Cabinet for approval in 2025/26, but the Department of Electricity and Energy decided not to go ahead with a stakeholder consultation process on the paper, pending the outcomes of the first bid window of the ITP procurement programme.
For this reason, the first bid window of the ITP procurement programme must run its course.
The department is also working on a five- to 10-year pipeline detailing the frequency of future bid windows and how the programme will work. This was meant to be released in the first quarter of 2026 but has been delayed.
Are there plans?
Electricity minister Kgosientsho Ramokgopa previously indicated that the government intends to establish an ITP Office, which will be located at either the Development Bank of Southern Africa (DBSA) or the Industrial Development Corporation (IDC), to procure new transmission capacity under a build, operate and transfer (BOT) model. But this is subject to evaluation. Currently the ITP programme is being facilitated by the IPP Office.
A team within the department is also developing a pipeline for future bid windows under the ITP programme, which may help inform the decision on whether to proceed with the ITP Office.
Is it on the agenda?
Plans were announced, but this is subject to an evaluation by the Department of Electricity and Energy based on the outcomes of the first bid window of the ITP procurement programme. The ITP Office has not been established. However the IPP Office is conducting the first bid window of the ITP procurement programme.
Goals
An Independent Transmission Project Office will be established to procure new transmission capacity. It will perform a role similar to that of the IPP Office in procuring generation capacity from the private sector.
Departments / Govt Institutions
No data available for the deliverable: Full unbundling of the NTCSA
No data available for the deliverable: Full unbundling of the NTCSA
No data available for the deliverable: Full unbundling of the NTCSA
No data available for the deliverable: Full unbundling of the NTCSA
No data available for the deliverable: Full unbundling of the NTCSA
No data available for the deliverable: Full unbundling of the NTCSA
No data available for the deliverable: Full unbundling of the NTCSA
No data available for the deliverable: Full unbundling of the NTCSA
Summary
The NTCSA has been operational since 1 July 2024 and has satisfied all the requirements necessary to effect the legal separation and operationalisation of the entity. After the Electricity Regulation Amendment (ERA) Act came into effect in January 2025, the NTCSA was officially established as the transmission system operator.
In his Sona in February 2026, President Cyril Ramaphosa overruled Eskom and the Department of Electricity and Energy's unbundling strategy and backed Operation Vulindlela and Treasury’s approach to establish an independent Transmission System Operator with asset ownership. The alternative (a TSO without assets) would remain financially and operationally dependent on Eskom, weakening its credibility with investors and limiting its ability to raise capital and negatively affect grid expansion. A dedicated task team under the National Energy Crisis Committee (Necom) was to report to the president in May 2026, after developing clear proposals and timelines for the phased implementation of a fully independent transmission entity, with transmission assets transferred out of Eskom. The timeline is delayed to end-June 2026, but the presidency has affirmed its commitment to the unbundling of an independent TSO.
Is it working?
It is a work in progress. The President's Sona announcement provided much-needed clarity on the future unbundling of the NTCSA, and establishment of the TSO due to be completed by 2028, when he leaves office. This move reasserts central authority over the unbundling process. The president has allowed a deadline extension from May to June 2026 for the task team to provide a set of detailed recommendations that also ensure that the TSO is financially sustainable and that Eskom would not be financially worse off due to the restructuring.
Actions
A dedicated task team under Necom will report to the president by June 2026 with a high-level proposal on the next steps and timelines for the unbundling of the TSO.
Thereafter the second phase will follow over three months requiring a detailed implementation roadmap.
Overall, 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.
The Lazard upward guarantee between the NTCSA and Eskom Holdings must also be resolved as it hinders the establishment of an independent transmission entity. The appointment of independent transaction advisors to National Treasury is key.
Are there plans?
A task team that involves the minister of electricity and energy, the minister of finance and the minister in the presidency will have to report to the president with clear proposals and timelines for the implementation of a fully independent TSO (with transmission assets) in the next 18 months, before Ramaphosa leaves office. We expect the day-to-day work to be steered by National Treasury and Operation Vulindlela. This intervention should provide more clarity on the future unbundling for creditors and other electricity market participants.
Eskom has issued a statement indicating it will support the task team.
The Lazard upward guarantee structure must still be resolved; no plans have been made public for this aspect of the unbundling as yet and will likely be informed by the work of the task team.
Is it on the agenda?
The Electricity Amendment Act, which came into effect in January 2025, gives effect to Eskom's unbundling and supports the liberalisation of the electricity market. The president further emphasised the establishment of an independent transmission entity in his Sona of 2026.
Goals
To establish the NTCSA as a duly constituted separate, distinct and wholly owned subsidiary of Eskom Holdings as per the provision of the Companies Act.
Departments / Govt Institutions
Department of Electricity and Energy Eskom Holdings National Treasury Operation Vulindlela
Summary
The NTCSA has been operational since 1 July 2024 and has satisfied all the requirements necessary to effect the legal separation and operationalisation of the entity. After the Electricity Regulation Amendment (ERA) Act came into effect in January 2025, the NTCSA was officially established as the transmission system operator.
In his Sona in February 2026, President Cyril Ramaphosa overruled Eskom and the Department of Electricity and Energy's unbundling strategy and backed Operation Vulindlela and Treasury’s approach to establish an independent Transmission System Operator with asset ownership. The alternative (a TSO without assets) would remain financially and operationally dependent on Eskom, weakening its credibility with investors and limiting its ability to raise capital and negatively affect grid expansion. A dedicated task team under the National Energy Crisis Committee (Necom) was to report to the president in May 2026, after developing clear proposals and timelines for the phased implementation of a fully independent transmission entity, with transmission assets transferred out of Eskom. The timeline is delayed to end-June 2026, but the presidency has affirmed its commitment to the unbundling of an independent TSO. Eskom is continuing to push against this.
Is it working?
It is a work in progress. The president's Sona announcement provided much-needed clarity on the future unbundling of the NTCSA, and establishment of the TSO due to be completed by 2028, when he leaves office. This move reasserts central authority over the unbundling process. The president has allowed a deadline extension from May to June 2026 for the task team to provide a set of detailed recommendations that also ensure that the TSO is financially sustainable and that Eskom would not be financially worse off due to the restructuring. It is believed a full proposal has been tabled with the president.
Actions
A dedicated task team under Necom will report to the president by June 2026 with a high-level proposal on the next steps and timelines for the unbundling of the TSO.
Thereafter the second phase will follow over three months requiring a detailed implementation roadmap.
Overall, 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.
The Lazard upward guarantee between the NTCSA and Eskom Holdings must also be resolved as it hinders the establishment of an independent transmission entity. The appointment of independent transaction advisors to National Treasury is key.
Are there plans?
A task team that involves the minister of electricity and energy, the minister of finance and the minister in the presidency will have to report to the president with clear proposals and timelines for the implementation of a fully independent TSO (with transmission assets) in the next 18 months, before Ramaphosa leaves office. We expect the day-to-day work to be steered by National Treasury and Operation Vulindlela. This intervention should provide more clarity on the future unbundling for creditors and other electricity market participants.
Eskom has issued a statement indicating it will support the task team.
The Lazard upward guarantee structure must still be resolved; no plans have been made public for this aspect of the unbundling as yet and will likely be informed by the work of the task team.
Is it on the agenda?
The Electricity Amendment Act, which came into effect in January 2025, gives effect to Eskom's unbundling and supports the liberalisation of the electricity market. The president further emphasised the establishment of an independent transmission entity in his Sona of 2026.
Goals
To establish the NTCSA as a duly constituted separate, distinct and wholly owned subsidiary of Eskom Holdings as per the provision of the Companies Act.
Departments / Govt Institutions
Department of Electricity and Energy Eskom Holdings National Treasury Operation Vulindlela
No data available for the deliverable: Grid Capacity Allocation Rules
No data available for the deliverable: Grid Capacity Allocation Rules
No data available for the deliverable: Grid Capacity Allocation Rules
No data available for the deliverable: Grid Capacity Allocation Rules
No data available for the deliverable: Grid Capacity Allocation Rules
No data available for the deliverable: Grid Capacity Allocation Rules
Summary
Eskom's Interim Grid Capacity Allocation Rules (IGCAR), to deal with grid constraints, prompted the National Energy Regulator of South Africa (Nersa) to lead a process to develop a permanent set of grid Capacity Allocation Rules that all network service providers would have to abide by. The development of the rules involved a public consultation process and were approved in November 2025. Nersa has since published the rules aimed at ensuring fair and non-discriminatory grid access.
View DetailsIs it working?
Still to be gazetted so not yet in effect. The rules have not been contested and focus on ensuring non-discriminatory access and equal treatment for all projects.
The rules reaffirm the “first ready, first served” principle that Eskom introduced to ensure scarce grid capacity is not hoarded by inactive projects.
The rules also define “first ready” in detail and set clear readiness criteria. They also removed earlier design and construction contract requirements which stakeholders in public consultation processes warned were impractical and not a true test of project readiness.
The rules introduce three milestones which now structure the queueing process: pre-feasibility, capacity reservation and capacity allocation.
The revised rules set out how projects enter the queue, how they progress, and how they may move up or down based on readiness.
This is aimed at ensuring a central, transparent and enforceable rule set to ensure consistent and fair grid access.
Actions
The rules have been developed and must be gazetted before they can be applied by network service providers like Eskom.
Are there plans?
The rules were a priority of Nersa, supported by the Department of Electricity and Energy (DoEE) as part of reforms needed to establish a competitive electricity market. The DoEE must gazette the rules. Once enforceable, Nersa must conduct monitoring to ensure compliance.
Is it on the agenda?
Yes, development of the rules was prompted by the IGCAR and part of the reforms overseen by Operation Vulindlela.
Goals
To establish Grid Capacity Allocation Rules that ensure ensure fair, transparent and non-discriminatory to access to the grid. The rules are part of overall efforts to establish a competitive electricity market, providing regulatory certainty that drives investment.
Documents
Departments / Govt Institutions
Department of Electricity and Energy National Energy Regulator of South Africa Operation Vulindlela
Summary
Eskom's Interim Grid Capacity Allocation Rules (IGCAR), to deal with grid constraints, prompted the National Energy Regulator of South Africa (Nersa) to lead a process to develop a permanent set of grid Capacity Allocation Rules that all network service providers would have to abide by. The development of the rules involved a public consultation process and were approved in November 2025. Nersa has since published the rules aimed at ensuring fair and non-discriminatory grid access.
View DetailsIs it working?
Still to be gazetted so not yet in effect. The rules have not been contested and focus on ensuring non-discriminatory access and equal treatment for all projects.
The rules reaffirm the “first ready, first served” principle that Eskom introduced to ensure scarce grid capacity is not hoarded by inactive projects.
The rules also define “first ready” in detail and set clear readiness criteria. They also removed earlier design and construction contract requirements which stakeholders in public consultation processes warned were impractical and not a true test of project readiness.
The rules introduce three milestones which now structure the queueing process: pre-feasibility, capacity reservation and capacity allocation.
The revised rules set out how projects enter the queue, how they progress, and how they may move up or down based on readiness.
This is aimed at ensuring a central, transparent and enforceable rule set to ensure consistent and fair grid access.
Actions
The rules have been developed and must be gazetted before they can be applied by network service providers like Eskom.
Are there plans?
The rules were a priority of Nersa, supported by the Department of Electricity and Energy (DoEE) as part of reforms needed to establish a competitive electricity market. The DoEE must gazette the rules. Once enforceable, Nersa must conduct monitoring to ensure compliance.
Is it on the agenda?
Yes, development of the rules was prompted by the IGCAR and part of the reforms overseen by Operation Vulindlela.
Goals
To establish Grid Capacity Allocation Rules that ensure ensure fair, transparent and non-discriminatory to access to the grid. The rules are part of overall efforts to establish a competitive electricity market, providing regulatory certainty that drives investment.
Documents
Departments / Govt Institutions
Department of Electricity and Energy National Energy Regulator of South Africa Operation Vulindlela
Summary
Eskom's Interim Grid Capacity Allocation Rules (IGCAR), to deal with grid constraints, prompted the National Energy Regulator of South Africa (Nersa) to lead a process to develop a permanent set of grid Capacity Allocation Rules for all network service providers. The development of the rules involved a public consultation process, and they were approved in November 2025. Nersa has since published the rules aimed at ensuring fair and non-discriminatory grid access. Enforcement, however, remains an issue, with concerns that Eskom is not complying with the Nersa rules.
View DetailsIs it working?
The rules are gazetted and in effect, but their enforcement is the next important step to assess to ensure non-discriminatory access and equal treatment for all projects. The South African Independent Power Producers Association (SAIPPA) has written to Eskom raising concerns that the utility is blocking grid access; while it also plans to transfer decommissioned coal plant grid points to Eskom Green, without any public consultation process. The situation may warrant an investigation by the Competition Commission.
According to Eskom's Dan Marokane, Nersa has written to network service providers to find out if they are complying with the rules, but it is not clear what Nersa's next steps are to ensure enforcement.
The rules reaffirm the “first ready, first served” principle that Eskom introduced to ensure scarce grid capacity is not hoarded by inactive projects.
The rules also define “first ready” in detail and set clear readiness criteria. They also remove earlier design and construction contract requirements which stakeholders in public consultation processes warned were impractical and not a true test of project readiness. The rules introduce three milestones which now structure the queueing process: pre-feasibility, capacity reservation and capacity allocation. The revised rules set out how projects enter the queue, how they progress, and how they may move up or down based on readiness. This is aimed at ensuring a central, transparent and enforceable rule set to ensure consistent and fair grid access.
Actions
The rules have been gazetted and must be applied by network service providers like Eskom. Nersa needs to improve its monitoring capacity to ensure enforcement.
Are there plans?
The rules were a priority of Nersa, supported by the Department of Electricity and Energy (DoEE) as part of reforms needed to establish a competitive electricity market. The rules have since been gazetted.
Is it on the agenda?
Yes, development of the rules was prompted by the IGCAR and part of the reforms overseen by Operation Vulindlela.
Goals
To establish Grid Capacity Allocation Rules that ensure ensure fair, transparent and non-discriminatory to access to the grid. The rules are part of overall efforts to establish a competitive electricity market, providing regulatory certainty that drives investment.
Documents
Departments / Govt Institutions
Department of Electricity and Energy National Energy Regulator of South Africa Operation Vulindlela
Summary
Eskom's Interim Grid Capacity Allocation Rules (IGCAR), to deal with grid constraints, prompted the National Energy Regulator of South Africa (Nersa) to lead a process to develop a permanent set of grid Capacity Allocation Rules for all network service providers. The development of the rules involved a public consultation process, and they were approved in November 2025. Nersa has since published the rules aimed at ensuring fair and non-discriminatory grid access. Enforcement, however, remains an issue, with concerns that Eskom is not complying with the Nersa rules.
View DetailsIs it working?
The rules are gazetted and in effect, but their enforcement is the next important step to assess to ensure non-discriminatory access and equal treatment for all projects. The South African Independent Power Producers Association (SAIPPA) has written to Eskom raising concerns that the utility is blocking grid access; while it also plans to transfer decommissioned coal plant grid points to Eskom Green, without any public consultation process. The situation may warrant an investigation by the Competition Commission.
According to Eskom's Dan Marokane, Nersa has written to network service providers to find out if they are complying with the rules, but it is not clear what Nersa's next steps are to ensure enforcement.
The rules reaffirm the “first ready, first served” principle that Eskom introduced to ensure scarce grid capacity is not hoarded by inactive projects.
The rules also define “first ready” in detail and set clear readiness criteria. They also remove earlier design and construction contract requirements which stakeholders in public consultation processes warned were impractical and not a true test of project readiness. The rules introduce three milestones which now structure the queueing process: pre-feasibility, capacity reservation and capacity allocation. The revised rules set out how projects enter the queue, how they progress, and how they may move up or down based on readiness. This is aimed at ensuring a central, transparent and enforceable rule set to ensure consistent and fair grid access.
Actions
The rules have been gazetted and must be applied by network service providers like Eskom. Nersa needs to improve its monitoring capacity to ensure enforcement.
Are there plans?
The rules were a priority of Nersa, supported by the Department of Electricity and Energy (DoEE) as part of reforms needed to establish a competitive electricity market. The rules have since been gazetted.
Is it on the agenda?
Yes, development of the rules was prompted by the IGCAR and part of the reforms overseen by Operation Vulindlela.
Goals
To establish Grid Capacity Allocation Rules that ensure ensure fair, transparent and non-discriminatory to access to the grid. The rules are part of overall efforts to establish a competitive electricity market, providing regulatory certainty that drives investment.
Documents
Departments / Govt Institutions
Department of Electricity and Energy National Energy Regulator of South Africa Operation Vulindlela
No data available for the deliverable: Independent Transmission Project (ITP) funding model / Credit Guarantee Vehicle
No data available for the deliverable: Independent Transmission Project (ITP) funding model / Credit Guarantee Vehicle
No data available for the deliverable: Independent Transmission Project (ITP) funding model / Credit Guarantee Vehicle
No data available for the deliverable: Independent Transmission Project (ITP) funding model / Credit Guarantee Vehicle
No data available for the deliverable: Independent Transmission Project (ITP) funding model / Credit Guarantee Vehicle
No data available for the deliverable: Independent Transmission Project (ITP) funding model / Credit Guarantee Vehicle
No data available for the deliverable: Independent Transmission Project (ITP) funding model / Credit Guarantee Vehicle
No data available for the deliverable: Independent Transmission Project (ITP) funding model / Credit Guarantee Vehicle
Summary
Eskom's Transmission Development Plan forecasts 56GW of new generation (mainly renewables) will be required by 2034 to provide energy security. To enable this new generation, approximately 14,500km of transmission network must be developed. Eskom will be unable to fund this from its balance sheet because of its massive debt. To address this, the development of the Credit Guarantee Vehicle (CGV) led by Treasury and the World Bank is under way to derisk transmission projects and crowd in more private finance.
Aims are for the electricity transmission infrastructure to be procured or developed by private sector players, who would carry the costs on their balance sheets. The first phase of the procurement process, a request for qualifications, was launched by the Electricity and Energy Department in July and seven prequalified bidders were named in December 2025 after 17 companies submitted bids. The final request for proposals for the programme is meant to be finalised by Q3 of 2026, aligning with the finalisation of the CGV. The CGV finalisation, however, faces delay risk.
Is it working?
Outcomes of the RFQ process were announced on 15 December 2025. Out of 17 companies that made submissions, seven were named qualifying bidders. They are all foreign-owned companies. Electricity and Energy Minister Kgosientsho Ramokgopa says that localisation will be built into the programme, and that in subsequent rounds (Bid Windows 3/4) South African companies are expected to be leading bidders.
As for round 1, the bidders will be involved in a process to finalise the RFP, with the aim of minimising risk and ensuring project bankability. The RFP is due to be released by Q3 of 2026, but this faces delays owing to challenges in finalising the Credit Guarantee Vehicle, critical for supporting bankability.
Actions
The DoEE minister issued a set of regulations to guide independent transmission projects. A ministerial determination to procure the development of 1,164km of 400kV transmission lines was issued in March 2025. Furthermore, an RFQ was launched in July 2025 to prequalify potential developers. Qualifying bidders were named in December 2025.
They will be involved in a consultation process to inform the final RFP.
Meanwhile, the development of the Credit Guarantee Vehicle, which will be in the form of a non-life insurance company, took a step forward in early March 2026 when it was announced that the Development Bank of Southern Africa (DBSA) will host a ring-fenced Project Implementation Unit to further support its establishment. The World Bank also approved the South Africa Blended Finance Platform for Resilient Infrastructure Programme which includes $350m financing from the International Bank for Reconstruction and Development to capitalise the CGV and support further project pipeline development and implementation capacity.
But the finalisation of the CGV is facing delays and is unlikely to be ready by Q3 2026.
Are there plans?
The DoEE has opted for the independent transmission projects as a form of private sector participation in transmission expansion. Phase 1 of the ITP programme is meant to go to market by Q3 of 2026 and is expected to unlock 3GW of renewable energy projects. Securing private sector developers is dependent on the Credit Guarantee Vehicle being operational by the second half of 2026 and offering credit guarantees for these projects.
Is it on the agenda?
Minister Ramokgopa has issued a ministerial determination allowing the state to procure 1,164km of transmission infrastructure to be developed by the private sector, specifically 400kV power lines and related transformers in the Northern Cape, the North West and Gauteng.
Goals
To enable financing to develop transmission infrastructure, including private sector participation. The national grid needs substantial upgrading and development to be able to connect new energy generation projects to help resolve South Africa's long-term electricity crisis.
Documents
Departments / Govt Institutions
Department of Electricity and Energy IPP Office National Treasury
Summary
Eskom's Transmission Development Plan forecasts 56GW of new generation (mainly renewables) will be required by 2034 to provide energy security. To enable this new generation, approximately 14,500km of transmission network must be developed. Eskom will be unable to fund this from its balance sheet because of its massive debt. To address this, the development of the Credit Guarantee Vehicle (CGV) led by Treasury and the World Bank is under way to derisk transmission projects and crowd in more private finance.
Aims are for the electricity transmission infrastructure to be procured or developed by private sector players, who would carry the costs on their balance sheets. The first phase of the procurement process, a request for qualifications, was launched by the Electricity and Energy Department in July and seven prequalified bidders were named in December 2025 after 17 companies submitted bids. The final request for proposals for the programme is meant to be finalised by Q3 of 2026, aligning with the finalisation of the CGV. The CGV finalisation, however, faces delay risk.
Is it working?
Outcomes of the RFQ process were announced on 15 December 2025. Out of 17 companies that made submissions, seven were named qualifying bidders. They are all foreign-owned companies. Electricity and Energy Minister Kgosientsho Ramokgopa says that localisation will be built into the programme, and that in subsequent rounds (Bid Windows 3/4) South African companies are expected to be leading bidders.
As for round 1, the bidders will be involved in a process to finalise the RFP, with the aim of minimising risk and ensuring project bankability. The RFP is due to be released by Q3 of 2026, but this faces delays owing to challenges in finalising the Credit Guarantee Vehicle, critical for supporting bankability.
Actions
The DoEE minister issued a set of regulations to guide independent transmission projects. A ministerial determination to procure the development of 1,164km of 400kV transmission lines was issued in March 2025. Furthermore, an RFQ was launched in July 2025 to prequalify potential developers. Qualifying bidders were named in December 2025.
They will be involved in a consultation process to inform the final RFP.
Meanwhile, the development of the Credit Guarantee Vehicle, which will be in the form of a non-life insurance company, took a step forward in early March 2026 when it was announced that the Development Bank of Southern Africa (DBSA) will host a ring-fenced Project Implementation Unit to further support its establishment. The World Bank also approved the South Africa Blended Finance Platform for Resilient Infrastructure Programme which includes $350m financing from the International Bank for Reconstruction and Development to capitalise the CGV and support further project pipeline development and implementation capacity.
But the finalisation of the CGV is facing delays and is unlikely to be ready by Q3 2026.
Are there plans?
The DoEE has opted for the independent transmission projects as a form of private sector participation in transmission expansion. Phase 1 of the ITP programme is meant to go to market by Q3 of 2026 and is expected to unlock 3GW of renewable energy projects. Securing private sector developers is dependent on the Credit Guarantee Vehicle being operational by the second half of 2026 and offering credit guarantees for these projects.
Is it on the agenda?
Minister Ramokgopa has issued a ministerial determination allowing the state to procure 1,164km of transmission infrastructure to be developed by the private sector, specifically 400kV power lines and related transformers in the Northern Cape, the North West and Gauteng.
Goals
To enable financing to develop transmission infrastructure, including private sector participation. The national grid needs substantial upgrading and development to be able to connect new energy generation projects to help resolve South Africa's long-term electricity crisis.
Documents
Departments / Govt Institutions
Department of Electricity and Energy IPP Office National Treasury
No data available for the deliverable: Interim Grid Capacity Allocation Rules (IGCAR)
No data available for the deliverable: Interim Grid Capacity Allocation Rules (IGCAR)
No data available for the deliverable: Interim Grid Capacity Allocation Rules (IGCAR)
No data available for the deliverable: Interim Grid Capacity Allocation Rules (IGCAR)
No data available for the deliverable: Interim Grid Capacity Allocation Rules (IGCAR)
No data available for the deliverable: Interim Grid Capacity Allocation Rules (IGCAR)
No data available for the deliverable: Interim Grid Capacity Allocation Rules (IGCAR)
No data available for the deliverable: Interim Grid Capacity Allocation Rules (IGCAR)
Summary
To address grid access failures of Bid Window 6, Eskom released its Interim Grid Capacity Allocation Rules (IGCAR) in 2023. These were formulated in response to surging demand for grid access in a context of acute grid scarcity. Based on these rules, Eskom does not grant grid access based on "first come, first served" principles anymore but rather on a “first ready, first served” basis. The power utility has established a set of standards that developers of new projects must adhere to in order to prove that their plans are "shovel-ready" and will eventually supply electricity to the grid. Developers must have power purchase agreements or contracts with buyers for electricity as well as environmental authorisations and water-use licences for the generation facility. Although interim rules were put in place, grid access remains a challenge for IPPs. The National Energy Regulator of South Africa (Nersa) subsequently led a process and approved Grid Capacity Allocation Rules which Eskom must also follow.
View DetailsIs it working?
The IGCAR has been in place since 2023 but grid access remains unresolved for IPPs. The interim grid access rules were meant to resolve this, but they are flawed. Despite a “non-discriminatory grid access” policy, many private developers struggle with opaque, inconsistent and sometimes discriminatory grid allocation rules. The Interim Grid Capacity Allocation Rules were meant to introduce a fair “first-ready, first-served” approach but in practice, the process has suffered from inconsistent implementation, lack of transparency in queue management, arbitrary delays and unclear criteria for approvals.
Actions
There have been changes made to the interim grid access rules since their establishment. Towards the end of 2023, the "first come, first served" method of the Interim Grid Capacity Allocation Rules (IGCAR) was replaced with a new system based on the idea of "first-ready, first served." It was also subject to a legal challenge, but this was dropped after Eskom eased some of the rules.
Are there plans?
Nersa led a process to develop Grid Capacity Allocation Rules, which were finalised and approved in November 2025.
Is it on the agenda?
Nersa was prompted to develop a set of Grid Capacity Allocation Rules to facilitate non-discriminatory and fair access. These were approved in November 2025 and now network service providers like Eskom must also adhere to these rules.
Goals
To eliminate grid queuing and hoarding and allowing space for shovel ready projects to get grid access.
Departments / Govt Institutions
Summary
To address grid access failures of Bid Window 6, Eskom released its Interim Grid Capacity Allocation Rules (IGCAR) in 2023. These were formulated in response to surging demand for grid access in a context of acute grid scarcity. Based on these rules, Eskom does not grant grid access based on "first come, first served" principles anymore but rather on a “first ready, first served” basis. The power utility has established a set of standards that developers of new projects must adhere to in order to prove that their plans are "shovel-ready" and will eventually supply electricity to the grid. Developers must have power purchase agreements or contracts with buyers for electricity as well as environmental authorisations and water-use licences for the generation facility. Although interim rules were put in place, grid access remains a challenge for IPPs. The National Energy Regulator of South Africa (Nersa) subsequently led a process and approved Grid Capacity Allocation Rules which Eskom must also follow.
View DetailsIs it working?
The IGCAR has been in place since 2023 but grid access remains unresolved for IPPs. The interim grid access rules were meant to resolve this, but they are flawed. Despite a “non-discriminatory grid access” policy, many private developers struggle with opaque, inconsistent and sometimes discriminatory grid allocation rules. The Interim Grid Capacity Allocation Rules were meant to introduce a fair “first-ready, first-served” approach but in practice, the process has suffered from inconsistent implementation, lack of transparency in queue management, arbitrary delays and unclear criteria for approvals.
Actions
There have been changes made to the interim grid access rules since their establishment. Towards the end of 2023, the "first come, first served" method of the Interim Grid Capacity Allocation Rules (IGCAR) was replaced with a new system based on the idea of "first-ready, first served." It was also subject to a legal challenge, but this was dropped after Eskom eased some of the rules.
Are there plans?
Nersa led a process to develop Grid Capacity Allocation Rules, which were finalised and approved in November 2025.
Is it on the agenda?
Nersa was prompted to develop a set of Grid Capacity Allocation Rules to facilitate non-discriminatory and fair access. These were approved in November 2025 and now network service providers like Eskom must also adhere to these rules.
Goals
To eliminate grid queuing and hoarding and allowing space for shovel ready projects to get grid access.
Departments / Govt Institutions
No data available for the deliverable: Removal of NTCSA upstream guarantee (‘Lazard Structure’)
No data available for the deliverable: Removal of NTCSA upstream guarantee (‘Lazard Structure’)
No data available for the deliverable: Removal of NTCSA upstream guarantee (‘Lazard Structure’)
No data available for the deliverable: Removal of NTCSA upstream guarantee (‘Lazard Structure’)
No data available for the deliverable: Removal of NTCSA upstream guarantee (‘Lazard Structure’)
No data available for the deliverable: Removal of NTCSA upstream guarantee (‘Lazard Structure’)
No data available for the deliverable: Removal of NTCSA upstream guarantee (‘Lazard Structure’)
No data available for the deliverable: Removal of NTCSA upstream guarantee (‘Lazard Structure’)
Summary
Eskom has been working with financial adviser Lazard for a number of years in an attempt to bolster its balance sheet. Lazard designed an upward guarantee structure from the National Transmission Company of South Africa to Eskom HoldCo, aimed at sidestepping several concerns that the public enterprises department and Eskom had, in particular, a risk aversion to creditor votes/approvals. In the process, however, it has caused a significant impediment to the efficient operationalisation of the NTCSA, as the structure prevents it from borrowing as an independent entity to scale transmission investment faster. The NTCSA has made slow progress in building transmission lines as a result. While it is tasked with extending the grid infrastructure, it is struggling to do so because it does not have the financial resources. Private sector investments in transmission build are needed.
View DetailsIs it working?
Given balance sheet constraints, the NTCSA has looked to alternative options to finance new transmission, such as the Independent Transmission Projects (ITP) procurement programme.
Actions
With the Electricity Regulation Amendment Act now in place and the NTCSA having been launched, the government has taken significant strides towards establishing the entity's independence. But the NTCSA is still a subsidiary of the Eskom HoldCo, and there are concerns about its financial independence, given the persistent Lazard structure.
Independent financial advice into the NTCSA is necessary. National Treasury must play a greater role in defining the end state of Eskom HoldCo's balance sheet and capital structure.
Are there plans?
President Cyril Ramaphosa, in his February 2026 State of the Nation Address, overruled Eskom's unbundling strategy approved by the Department of Electricity and Energy that would have seen a Transmission System Operator established without asset ownership. The president has established a task team under the National Electricity Crisis Committee that will develop clear proposals and timelines for the establishment of a fully independent transmission entity with asset ownership. The high-level proposal was expected to be tabled in June 2026 with an implementation plan overseen by a transaction advisor to be finalised in September. The work of the task team should have a bearing on defining the end state of Eskom's capital structure and balance sheet - including resolving the Lazard structure with independent transaction advice.
Is it on the agenda?
President Cyril Ramaphosa's 2026 State of the Nation Address provides clarity on the future direction of Eskom's unbundling, including the establishment of an independent transmission entity with asset ownership.
This supports the work of Operation Vulindlela (which includes Treasury) which is working towards the functional independence of the NTCSA. It is expected that this work includes finding new financial models to address the Lazard structure.
Goals
The removal of the Lazard structure is a critical step for the operational independence of the NTCSA.
Documents
Departments / Govt Institutions
Department of Electricity and Energy Eskom Holdings National Treasury Operation Vulindlela
Summary
Eskom has been working with financial adviser Lazard for a number of years in an attempt to bolster its balance sheet. Lazard designed an upward guarantee structure from the National Transmission Company of South Africa to Eskom HoldCo, aimed at sidestepping several concerns that the public enterprises department and Eskom had, in particular, a risk aversion to creditor votes/approvals. In the process, however, it has caused a significant impediment to the efficient operationalisation of the NTCSA, as the structure prevents it from borrowing as an independent entity to scale transmission investment faster. The NTCSA has made slow progress in building transmission lines as a result. While it is tasked with extending the grid infrastructure, it is struggling to do so because it does not have the financial resources. Private sector investments in transmission build are needed.
View DetailsIs it working?
Given balance sheet constraints, the NTCSA has looked to alternative options to finance new transmission, such as the Independent Transmission Projects (ITP) procurement programme.
Actions
With the Electricity Regulation Amendment Act now in place and the NTCSA having been launched, the government has taken significant strides towards establishing the entity's independence. But the NTCSA is still a subsidiary of the Eskom HoldCo, and there are concerns about its financial independence, given the persistent Lazard structure.
Independent financial advice into the NTCSA is necessary. National Treasury must play a greater role in defining the end state of Eskom HoldCo's balance sheet and capital structure.
Are there plans?
President Cyril Ramaphosa, in his February 2026 State of the Nation Address, overruled Eskom's unbundling strategy approved by the Department of Electricity and Energy that would have seen a Transmission System Operator established without asset ownership. The president has established a task team under the National Electricity Crisis Committee that will develop clear proposals and timelines for the establishment of a fully independent transmission entity with asset ownership. The high-level proposal was expected to be tabled in June 2026 with an implementation plan overseen by a transaction advisor to be finalised in September. The work of the task team should have a bearing on defining the end state of Eskom's capital structure and balance sheet - including resolving the Lazard structure with independent transaction advice.
Is it on the agenda?
President Cyril Ramaphosa's 2026 State of the Nation Address provides clarity on the future direction of Eskom's unbundling, including the establishment of an independent transmission entity with asset ownership.
This supports the work of Operation Vulindlela (which includes Treasury) which is working towards the functional independence of the NTCSA. It is expected that this work includes finding new financial models to address the Lazard structure.
Goals
The removal of the Lazard structure is a critical step for the operational independence of the NTCSA.
Documents
Departments / Govt Institutions
Department of Electricity and Energy Eskom Holdings National Treasury Operation Vulindlela