{"id":865517,"date":"2026-07-06T09:39:48","date_gmt":"2026-07-06T07:39:48","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=865517"},"modified":"2026-07-06T09:39:51","modified_gmt":"2026-07-06T07:39:51","slug":"businesses-in-south-africa-are-doing-everything-they-can-to-dump-eskom","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/energy\/865517\/businesses-in-south-africa-are-doing-everything-they-can-to-dump-eskom\/","title":{"rendered":"Businesses in South Africa are doing everything they can to dump Eskom"},"content":{"rendered":"\n

Years of unreliable and costly electricity supply have transformed South Africa\u2019s power landscape, with companies taking\u00a0matters\u00a0into their own hands.\u00a0<\/p>\n\n\n\n

Businesses have taken advantage of market reforms and invested billions of rands in renewable energy to protect against almost two\u00a0decades of rolling blackouts and steep price increases.<\/p>\n\n\n\n

These have exposed the risks of relying solely on state-owned power utility, Eskom, and of deteriorating municipal distribution networks.\u00a0<\/p>\n\n\n\n

Many of the major companies traded on the benchmark index in Johannesburg\u2014spanning mining, real estate, retail and healthcare, among other sectors\u2014say they’re working to boost renewables to lower dependency on Eskom and cut costs.<\/p>\n\n\n\n

At least 40 firms in 2026 alone are sharing such plans.\u00a0<\/p>\n\n\n\n

While Eskom has stabilised\u00a0supply and managed more than a year without load shedding,\u00a0homes and businesses are often exposed to prolonged local outages because towns and cities haven\u2019t maintained or upgraded their cables and transformers.\u00a0<\/p>\n\n\n\n

The migration to private renewables supply is transforming Africa’s biggest electricity market from one dominated by a state monopoly into one where companies increasingly choose how and from whom they buy electricity.<\/p>\n\n\n\n

\u201cWe had 102 years of a monopoly responsible for energy, and now it\u2019s a liberalised market where businesses can choose where they get their energy from,\u201d said Andre Nepgen, the chief executive officer of Discovery Green, a renewable-energy trading platform set up by insurer Discovery in 2023.<\/p>\n\n\n\n

Impala Platinum, the world\u2019s No. 2 producer of the metal used in electronics and devices that cut vehicle emissions,\u00a0is among the firms that have had to rethink how they\u00a0power their\u00a0operations in South Africa, home to most of the producer\u2019s mines.\u00a0<\/p>\n\n\n\n

In 2024, it partnered with\u00a0Discovery Green to obtain clean electricity for its refinery east of Johannesburg through wheeling.<\/p>\n\n\n\n

This\u00a0involves buying power from\u00a0off-site independent producers who then feed it into the\u00a0national grid, allowing buyers to withdraw an equivalent amount at their location. <\/p>\n\n\n\n

It\u2019s also exploring solar options for its biggest operation, Rustenburg, as well as the smaller Marula mine.<\/p>\n\n\n\n

\u201cOur decision was shaped by a convergence of factors rather than a single trigger\u201d that include a climate imperative, operational realities and costs,\u00a0Sustainable Development Executive Tsakani Mthombeni said by email. <\/p>\n\n\n\n

\u201cSouth Africa\u2019s electricity-supply constraints pose a direct risk to our operations\u2019 safety and production,\u201d with renewables bolstering security, he said, adding that reliability \u201cis non-negotiable.\u201d \u00a0<\/p>\n\n\n\n

The corporate renewable-energy market that Discovery Green is part of took off after 2021, when the state opened up private power generation and wheeling to tackle chronic shortages. <\/p>\n\n\n\n

Government buying under its so-called Renewable Energy Independent Power Producer Procurement Programme initially drove growth in South Africa’s renewable industry. <\/p>\n\n\n\n

The latest expansion, however, has come from companies investing their own capital after the reforms opened the market to private generation and electricity trading.<\/p>\n\n\n\n

\"\"<\/a><\/figure>\n\n\n\n

Electricity price death spiral<\/h2>\n\n\n\n

While supply constraints are\u00a0among the chief drivers of the move to renewables, the cost of power is a major factor as well. <\/p>\n\n\n\n

The regulator has allowed Eskom to raise\u00a0tariffs by rates that have far exceeded inflation in recent years to help the company meet its obligations, as the government struggles to rein in non-paying municipalities. <\/p>\n\n\n\n

Prices have climbed almost 900% since 2008, equating to an average annual increase of about 15% since then. <\/p>\n\n\n\n

Eskom, meanwhile, still struggles with a long-term debt pile of R358 billion.<\/p>\n\n\n\n

These hikes have\u00a0eaten into companies\u2019\u00a0profit margins, and they need to find cheaper alternatives, said Richard Doyle, managing director of\u00a0 JUWI South Africa, which builds and maintains solar and wind plants.\u00a0<\/p>\n\n\n\n

\u201cThe cost of buying energy from Eskom is over R2\u201d per kilowatt-hour, Doyle said. <\/p>\n\n\n\n

\u201cThe levelised cost of solar power now is maybe 50 to 60 cents. It is a complete commercial no-brainer for any and all industries now to move towards solar power.\u201d<\/p>\n\n\n\n

Predictability is also a major motivating factor, said Nepgen. <\/p>\n\n\n\n

\u201cThe certainty element of saying\u00a0\u2018this is my cost, and it\u2019s only going to increase by CPI\u2019 is hugely valuable for businesses,\u201d he said, referring to consumer price inflation. <\/p>\n\n\n\n

\u201cWhen you\u2019re deciding\u00a0\u00a0on whether or not to open a new facility, if you have uncertainty around your future electricity costs, that might discourage investment, so that CPI hedge really helps.\u201d<\/p>\n\n\n\n

South Africa has more than 2,500 renewable-energy projects with 19,677 megawatts of generating capacity registered with the National Energy Regulator compared with under 20 megawatts in 2018, the South African Photovoltaic Industry Association said.<\/p>\n\n\n\n

The National Transmission Company of South Africa separately estimates that the nation has about 8,400 megawatts of so-called behind-the-meter private solar installations that generate power for on-site use and don\u2019t supply the grid. The datasets aren\u2019t comparable and likely overlap in part.\u00a0

Eskom has a total installed capacity of about 53,200 megawatts, 85% of which is coal.\u00a0<\/p>\n\n\n\n

\"\"<\/a><\/figure>\n\n\n\n

Big change for Eskom<\/h2>\n\n\n\n

The boom in private generation is redefining Eskom\u2019s role in provision.<\/p>\n\n\n\n

With consumers forced to find alternative sources of consistent supply, Eskom\u2019s revenue has declined.<\/p>\n\n\n\n

And with the switch to lower-cost options eroding demand from the utility, it\u00a0seeks bigger price increases that further cut clients\u2019 reliance on it, deepening what the utility itself calls a \u201cdeath spiral.\u201d <\/p>\n\n\n\n

Eskom didn\u2019t respond to a request for comment.<\/p>\n\n\n\n

The South African central bank has brought attention to the knock-on effects<\/a> of inadequate public infrastructure on financial stability, noting in June that increased substitution with private generation also hurts the coffers of municipalities, many of which on-sell Eskom\u2019s supply. <\/p>\n\n\n\n

The company has responded by launching Eskom Green, a utility-scale renewable-energy developer that targets 6,000 megawatts of capacity by the end of the decade.<\/p>\n\n\n\n

The move \u201cis a market signal that renewable energy is now considered essential and is no longer a luxury,\u201d Impala\u2019s Mthombeni said.<\/p>\n\n\n\n

After more than a century of relying on a single dominant utility, businesses are gaining more choices about where their electricity comes from and how much they pay for it.<\/p>\n\n\n\n

For Eskom, the challenge is no longer simply keeping the lights on. It’s adapting to a competitive electricity market where its biggest customers increasingly have alternatives.<\/p>\n\n\n\n

\u201cWe expect renewable energy to play a central role in stabilising the country\u2019s energy system,\u201d Mthombeni said.<\/p>\n\n\n\n

\u201cRenewable-energy technology will not replace the grid, but it will complement it\u2014creating a more diversified, resilient and sustainable energy mix.\u201d\u00a0<\/p>\n\n\n\n

\"\"<\/a><\/figure>\n","protected":false},"excerpt":{"rendered":"

Years of unreliable and costly electricity supply have transformed South Africa\u2019s power landscape, with companies taking\u00a0matters\u00a0into their own hands.\u00a0<\/p>\n","protected":false},"author":59,"featured_media":859376,"comment_status":"open","ping_status":"closed","sticky":true,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9874],"tags":[1164],"class_list":["post-865517","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-energy","tag-eskom"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/865517","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=865517"}],"version-history":[{"count":1,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/865517\/revisions"}],"predecessor-version":[{"id":865521,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/865517\/revisions\/865521"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/859376"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=865517"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=865517"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=865517"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}