{"id":871593,"date":"2026-08-21T17:27:52","date_gmt":"2026-08-21T15:27:52","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=871593"},"modified":"2026-08-21T17:27:55","modified_gmt":"2026-08-21T15:27:55","slug":"end-of-a-103-year-monopoly-in-south-africa","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/energy\/871593\/end-of-a-103-year-monopoly-in-south-africa\/","title":{"rendered":"End of a 103-year monopoly in South Africa"},"content":{"rendered":"\n

South Africa’s government has gazetted its electricity market transformation position paper for public comment, in line with its plans to create a competitive energy market.<\/p>\n\n\n\n

The move to create a competitive electricity market and end Eskom’s 103-year-old monopoly over the national grid has created tension between the company and the government.<\/p>\n\n\n\n

Eskom initially welcomed the move but has expressed concerns over the unbundling of its transmission systems into an independent Transmission Systems Operator (TSO).<\/p>\n\n\n\n

Transmission systems account for a large share of Eskom’s earnings, and the company believes the planned unbundling could weaken its finances and worry investors.<\/p>\n\n\n\n

Along with Eskom, organisations such as the National Union of Mineworkers (NUM) opposed the move, saying it would increase private-sector control.<\/p>\n\n\n\n

President Cyril Ramaphosa then introduced the Eskom Restructuring Task Team (ERRT) to establish the feasibility of Eskom unbundling.<\/p>\n\n\n\n

In its phase one report, the team said that the Eskom unbundling was possible, and that the country’s transmission systems would be handed over to an independent TSO.<\/p>\n\n\n\n

The Electricity Market Transformation Position Paper was subsequently presented to parliament and has now been published for public comment.<\/p>\n\n\n\n

The aim of the position paper is to promote economic growth and development through a secure and reliable electricity supply.<\/p>\n\n\n\n

The paper said that the introduction of a wholesale energy market will “enable ongoing competition amongst generators within the market.”<\/p>\n\n\n\n

“This will lead to more accurate and transparent price signals and better incentives that will encourage improved short-term performance.”<\/p>\n\n\n\n

The document is intended to serve as a guide for the ongoing changes to the energy sector and its frameworks.<\/p>\n\n\n\n

In the new energy market, generation will become competitive, with private producers able to compete against Eskom.<\/p>\n\n\n\n

The transmission systems and market operations will remain regulated but will be handled by a company separate from Eskom.<\/p>\n\n\n\n

The retail and trading market will face both competition and regulation, as the government works to ensure the market is fair for buyers.<\/p>\n\n\n\n

Electricity supply from municipalities and directly from Eskom will be subject to price regulations in the retail market, while private suppliers will not be.<\/p>\n\n\n\n

Revised Electricity Pricing Policy<\/h2>\n\n\n\n
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In addition to the Energy Market Transformation Position Paper, the Department of Electricity and Energy is expected to introduce a Revised Electricity Pricing Policy.<\/p>\n\n\n\n

This policy will govern how electricity tariffs are implemented in the future and provide consumers with transparency about price changes.<\/p>\n\n\n\n

In a recent media briefing, the Minister of Electricity and Energy, Kgosientsho Ramokgopa, said the policy would give certainty on future energy prices.<\/p>\n\n\n\n

“We want everyone to have some degree of certainty on what will be the cost of electricity, not just today or tomorrow,” he said. “We want to create a ten-year horizon.”<\/p>\n\n\n\n

The policy would introduce a ten-year price forecast, which NERSA would have to publish, outlining future electricity tariff increases.<\/p>\n\n\n\n

Electricity tariffs have increased exponentially in recent years, with energy prices roughly doubling in the last decade. <\/p>\n\n\n\n

This has placed pressure on households and has impacted businesses which are heavily energy dependent, such as mining operations.<\/p>\n\n\n\n

“For heavy industries, when people want to make significant investments in the South African economy, they want to compute their return on investment,” Ramokgopa said.<\/p>\n\n\n\n

A tariff forecast will help potential investors understand a business’s future costs, reducing investment risk.<\/p>\n\n\n\n

The Electricity Market Transformation Position Paper can be read below:<\/p>\n\n\n\n