Latest news with #TransmissionDevelopmentPlan
Daily Maverick
03-07-2025
- Business
- Daily Maverick
Gridlock: The urgent imperative to increase SA's transmission capacity
South Africa is not short on ambition or potential when it comes to energy reform. The country's renewable energy market is maturing. Investment appetite is increasing and policy shifts, like the recent Electricity Regulation Act, indicate focused commitment to achieving a more competitive, sustainable and competitive energy market. However, one obstacle remains a hindrance to this momentum - transmission. Despite billions of rand committed to generation, over 20GW of renewable energy remains untapped due to a lack of grid capacity. As the country scrambles to meet rising energy demand and decarbonise its economy, transmission has emerged as the single most critical enabler of energy security and low-carbon growth. Importantly, the lack of transmission is not just a technical hurdle. It is the vital lever that is needed to unlock real energy transformation. With open access to the grid, more independent power producers (IPPs) will be able to participate and, more importantly, the increased capacity created by a robust transmission ecosystem will mean that South Africa (SA) can unleash the full potential of renewables – cutting emissions while improving reliability. The good news is that we appear to finally be on the path towards this enhanced transmission capacity. The establishment of the National Transmission Company of South Africa (NTCSA), to be spun off from Eskom, was a significant early milestone on this journey. This unbundling will enable open and transparent access to the grid for public and private generators. It will also pave the way for the trading of electricity through market platforms and wheeling arrangements, creating the foundation for a more dynamic and competitive power sector. The NTCSA coupled with the proposed Independent Transmission Projects (ITP) programme, creates a compelling case for private sector participation, not just in generation but also in grid infrastructure. However, there is still a long road ahead. The Transmission Development Plan (TDP) 2024 identifies the ambitious objective of integrating around 56GW of new generation and constructing over 14 000km of transmission lines by 2034. That is less than 10 years from now. The initial phase to 2029 targets a more realistic 5 043km of powerlines, but with only 286km expected to be completed in 2025, the gap between ambition and delivery remains immense. Also, with Eskom's financial constraints and national debt levels limiting national government's capacity to finance these builds, the success of the ITP programme will depend heavily on attracting private sector buy in, partnership and investment. Private investment in these ITP projects will require clear revenue models, predictable tariff structures and credible counterparties. The private sector needs certainty, not just around returns, but also when it comes to things like termination and non-payment recourse. South Africa could apply lessons from past public-private partnerships, like the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP). A stable, predictable, and transparent regulatory environment, consistently applied, is key. Investors will need absolute certainty regarding tariff structures, off-take agreements with the NTCSA, and the long-term security of their substantial investments. The government's commitment to late-stage tendering – ensuring environmental approvals and servitudes are largely in place before bids – is a sensible move to de-risk projects. Standard Bank is actively engaged in this sector, working to structure bankable transmission models. There are multiple avenues to de-risk transmission investments, and we can leverage global lessons and precedents to achieve this. Countries like Brazil and Peru have successfully deployed BOOT (Build, Own, Operate, Transfer) models to deliver thousands of kilometres of grid infrastructure. We do not see any reason why South Africa cannot do the same. Transmission infrastructure does not have to be the bottleneck; it is an enabler of energy reform. But to do that, it needs to become a national investment priority. There are encouraging signs that this may be the case. The Request for Information (RFI) that took place between December 2024 and February 2025 gathered insights from market participants on how to accelerate the development of transmission infrastructure. Further milestones include the imminent release of the full Request for Proposal (RFP), which will signal a vital shift from talking and planning to execution, and allow government to shape the legal frameworks, procurement mechanisms and support instruments that will guide the first batch of independent transmission projects to market. This is the crucial next step in shifting SA's energy reality from crisis management to long-term and sustainable resilience. DM
IOL News
08-06-2025
- Business
- IOL News
South Africa's Independent Transmission Projects Programme: Key progress and future plans
Wind turbines lined up at Rietkloof Wind Farm. According to the Integrated Resource Plan (IRP 2019) and Eskom's Transmission Development Plan (TDP 2024–2033), over 14 000 km of new transmission lines are required within the next decade to accommodate an additional 53 GW of generation capacity. South Africa's Department of Electricity and Energy (DEE) and National Treasury have announced significant strides in the Independent Transmission Projects (ITP) Programme, a public-private partnership aimed at revolutionising the nation's transmission infrastructure. The initiative seeks to unlock billions in investment, accelerate economic growth, and support the country's energy transition by modernizing its overstretched power grid. According to the Integrated Resource Plan (IRP 2019) and Eskom's Transmission Development Plan (TDP 2024–2033), over 14 000 km of new transmission lines are required within the next decade to accommodate an additional 53 GW of generation capacity. With the current grid expansion lagging at an inadequate pace, the government aims to construct at least 1 400 km of lines annually to ensure energy security and economic stability. "Government is acting deliberately, and decisively to partner with the private sector to assist the National Transmission Company of South Africa (NTCSA) to accelerate the rollout of the transmission infrastructure to enable economic growth and the addition of the renewable energy capacity," DEE and Treasury said in a statement on Friday. They said the government has made notable progress since the programme's inception. A global market sounding exercise conducted between December 2024 and February 2025 garnered over 130 responses from local and international developers, financiers, and manufacturers. Key findings highlighted strong interest in partnerships, with 44% of local respondents planning collaborations with global entities. Stakeholders agreed there was a need for a stable regulatory environment and a predictable project pipeline to ensure investment and supply chain readiness. "Risks identified included permitting, Right of Way, and supply chain constraints, which will be proactively mitigated through upfront government measures, drawing on global best practice," they said. On March 28, 2025, a landmark Ministerial Determination was gazetted, designating the DEE as the procurer and the NTCSA as the buyer under Transmission Services Agreements (TSAs). The determination outlined a 1 164 km project scope of 400kV transmission lines across the Northern Cape, North-West, and Gauteng, with procurement adhering to fair and competitive tendering processes. Further advancing the programme, draft Electricity Transmission Regulations were gazetted for public comment on April 3, 2025. These regulations establish transparent cost recovery mechanisms, defined regulatory approval processes, and enforceable project implementation frameworks to ensure the programme's bankability. Following the close of public consultations on May 22, 2025, the DEE is finalising the regulations for promulgation, DEE and Treasury said. Structured Procurement Timeline The Independent Power Producer (IPP) Office, leveraging its proven expertise in energy procurement, will oversee the ITP's Phase 1 tender process. A pre-qualification tender (Request for Qualification) is set for July to shortlist capable bidders, followed by a Request for Proposals by November. "These timelines provide developers with sufficient lead time for due diligence and consortium formation, ensuring a robust and credible procurement process," they said. Innovative Financing Solutions To bridge South Africa's infrastructure funding gap, the government, in collaboration with the World Bank, is developing a Credit Guarantee Vehicle (CGV). Operating as a licensed non-life insurance company, the CGV aims to mobilize private capital and support the Just Energy Transition Partnership (JETP) decarbonisation goals. "A draft Information Memorandum (formal offer via private placement of shares in the CGV) which provide granular details on how the CGV 4 of 4 will operate has been developed and will be shared with our development partners. Following the sharing of the Information Memorandum, the team will in July 2025 engage in one-on-one discussion with the identified development partners who expressed interest in participating in phase one of the CGV. It is envisaged that the CGV will become operational in 2026," the statement said. Looking ahead, the government reaffirms that a programmatic, multi-phase ITP rollout will follow the Phase 1 tender, ensuring a clear pipeline of future bid windows to: • Stimulate industrialisation, support local manufacturing, and build domestic technical capability. • Enable continuous improvement in procurement design and risk allocation. • Foster market depth, investor confidence, and price discovery. BUSINESS REPORT
The Citizen
09-05-2025
- Business
- The Citizen
Eskom recalls National Transmission Company CEO Segomoco Scheppers
Scheppers was seconded to lead the transition and operationalise the NTCSA. Eskom has recalled National Transmission Company South Africa (NTCSA) interim CEO Segomoco Scheppers. The utility on Thursday said Scheppers will conclude his secondment and return to Eskom. Scheppers was seconded to lead the transition and operationalise the NTCSA business in July 2024 due to his extensive experience in the Transmission Division, having joined Eskom in 1993. New CEO Eskom said Scheppers served at the NTCSA while the executive search process to appoint a permanent CEO for the subsidiary was underway 'Although Scheppers was shortlisted for the permanent role, the NTCSA Board has not yet identified the candidate to lead the business into its next phase. ALSO READ: Eskom winter outlook: Here's how many days of load shedding to expect in SA 'The NTCSA and Eskom Holdings Boards are committed to expediting the executive search and securing the appointment of a CEO who will navigate the complexities of operating in a competitive energy market,' Eskom said. Transmission Development Plan Eskom said a formal announcement will be made soon regarding the appointment of an ICEO of NTCSA to continue executing the strategy. The strategy includes implementing an accelerated Transmission Development Plan (TDP), continuing operational unbundling activities as required by legislation, and establishing a fair, competitive electricity market. 'We owe Segomoco a huge debt of thanks for the skills he brought to bear to take the transmission business to a point of separation and create the NTCSA as a wholly owned subsidiary of Eskom Holdings. The NTCSA serves as an important catalyst in the country's evolving energy supply industry and ending the vertical integration business model for the benefit of consumers,' said Priscillah Mabelane, NTCSA Board Chairperson. Critical role Mabelane said that Scheppers played a critical role in delivering the NTCSA, which is designed to provide the benefits of the Electricity Regulation Amendment Act (ERAA). 'His work paves the way for the necessary reforms in South Africa's electricity sector, including the establishment of a competitive electricity market that will contribute meaningfully to South Africa's energy security and inclusive economic development,' said Mabelane. ALSO READ: Winter is coming: Does Eskom have a plan to prevent load shedding?
