South Africa Advances Power Sector Reform to Enable Competitive Market and Scale Renewables

Cyril Ramaphosa, the President of South Africa, has made the structural reform of the country’s electricity market a core part of its investment drive, demonstrating the country’s move towards a liberalised market and increased uptake of renewable energy.

In his speech at the South African Investment Conference 2026, President Ramaphosa said the reform is the most significant change to the country’s electricity market since its democratisation, and the reforms are already boosting investors’ sentiment and mobilising investment.

Another important pillar is the unbundling of Eskom and the creation of the National Transmission Company South Africa, an independent grid operator. This includes a transparent and rules-based system for grid access, a crucial element for scaling up private generation.
These actions are a continuation of the 2022 Energy Action Plan, which has helped improve system reliability after a prolonged period of load shedding. The increased reliability of supply has been instrumental in rebuilding confidence.

The pipeline for renewable energy is significant. Over 220 GW of projects are currently in development, with about 36 GW in the grid connection pipeline. Further additions to solar PV, wind, and battery storage are expected to alter the energy landscape, reduce greenhouse gas emissions, and improve cost competitiveness.

On the market reform side, the government will introduce a competitive wholesale electricity market, along with the unbundling of Eskom. This is expected to improve price discovery and efficiency, with further opportunities emerging for independent power producers.
Addressing transmission constraints, government policy now enables private sector participation in grid expansion through Independent Transmission Projects. This marks a significant shift from the traditional state-led model and is expected to accelerate network build-out in high-potential renewable regions.

Operation Vulindlela, an initiative of the Presidency and the National Treasury of South Africa, has been launched to remove structural bottlenecks and enhance the investment environment, and this will anchor the reform agenda.

With confirmed renewable investment of approximately $1.6 billion and an ambitious plan to mobilise $110 billion over the next five years, execution, especially in the areas of transmission and market development, will drive the pace and success of the transition to a competitive and low-carbon power system in South Africa.