Brief

South Africa’s Power Surge: 1.92GW of New Generation and a Shift to Market‑Based Electricity Trading

In the first half of 2026, 17 independent power producer projects went commercial, adding 1.92GW of capacity and prompting a shift from a single‑supplier system to market‑based trading.

By Felo News Desk · Published Tue, 29 Sep 2026 16:52:05 GMT

In the first half of 2026, 17 independent power producer projects reached commercial operation in South Africa, adding 1.92GW of capacity – the largest single‑half‑year gain and exceeding the 2016 full‑year record of 1.47GW, according to the Power Futures Lab at the University of Cape Town’s Graduate School of Business.

That surge is matched by a regulatory shift that has moved the country from a single‑supplier grid to a market‑based model. In 2021 the generation licensing threshold was raised from 1MW to 100MW, and in January 2023 amendments to Schedule 2 of the Electricity Regulation Act removed licensing for any facility wheeling power to customers across third‑party networks, regardless of size. Registration now replaces permission.

Wheeling of Renewable Power Across Municipal Networks

Cape Town has led the transition. In May, Growthpoint, trader Etana Energy and the city announced the first pooled wheeling of renewable electricity across multiple properties on the municipal network. Power from the Boston hydroelectric plant near Clarens in the Free State – co‑owned by Serengeti Energy and Growthpoint – is wheeled across Eskom’s network into the municipal grid and allocated across five Growthpoint buildings rather than a single site. Growthpoint aims to extend this to more than 30 properties.

Market‑Based Buying of Renewable Generation

Discovery Green CEO Andre Nepgen noted that roughly 80% of newly closed private renewable generation is now channelled through traders rather than direct bilateral contracts, meaning buyers purchase from a market rather than a generator.

Smart Metering and Granular Measurement

Measurement accuracy has improved with cheaper sensors, low‑power wide‑area networks and cloud platforms. Eskom’s smart meter programme targets 577,347 meters on load‑reduction feeders; by 11 September it had installed 513,022, about 89% of that target, though the target was set for March 2026. The programme runs to 2029. Cape Town has also committed R1.1 billion to the first phase of advanced water metering, deploying about 83,000 meters between April 2026 and an unspecified end date.

These developments signal a broader shift in South Africa’s energy sector, as new generation capacity and regulatory changes reshape how organisations manage their energy procurement and accounting.

Key facts

17 independent power producer projects went commercial in H1 2026, adding 1.92GW (techcentral.co.za)
The 1.92GW addition exceeds the 2016 full‑year record of 1.47GW (techcentral.co.za)
In 2021 the generation licensing threshold was raised from 1MW to 100MW (techcentral.co.za)
January 2023 amendments removed licensing for any facility wheeling power across third‑party networks (techcentral.co.za)
Eskom’s smart meter programme targeted 577,347 meters; 513,022 were installed by 11 September (techcentral.co.za)