South Africa’s electricity crisis — the grid is the real threat to energy security

For all the talk of ending load shedding permanently, South Africa’s greatest energy security threat is no longer just ageing coal plants — it’s the grid. Without urgent investment in transmission infrastructure and fair access to grid capacity, we will not solve the country’s energy crisis.

Eskom itself estimates that 14,000km of new transmission lines are needed over the next decade to connect new power generation, yet in 2023, it managed just 326km.

This infrastructure bottleneck is choking South Africa’s energy transition and holding back billions of rands in private investment. Failure to increase grid capacity is now the single biggest factor limiting new power generation, slowing economic growth and potentially prolonging the risks of load shedding.

The transmission grid is the bottleneck

South Africa has finally begun adding new energy supply. The private sector has stepped in, driven by deregulated self-generation, the Renewable Energy Independent Power Producer Programme (REI4P)​, and large corporate buyers. Yet many new projects — particularly wind and solar farms — cannot connect to the grid.

The challenge has two dimensions:

1.     Not enough new transmission lines: The grid was built for coal plants clustered in Mpumalanga, not for the wind and solar potential in the Northern, Eastern and Western Cape​. New transmission lines need to be built rapidly to evacuate this energy; and


2.     A flawed grid access process: Despite a “non-discriminatory grid access” policy, many private developers struggle with opaque, inconsistent and sometimes discriminatory grid allocation rules. The Interim Grid Capacity Allocation Rules were meant to introduce a fair “first-ready, first-served” approach, but in practice, the process has suffered from inconsistent implementation, lack of transparency in queue management, arbitrary delays and unclear criteria for approvals.

Eskom’s conflict of interest and the case for full unbundling

The problem is exacerbated by Eskom’s dual role as both grid operator and competitor in power generation. While private investors are eager to build power projects, Eskom appears to be slow-walking grid approvals and reserving space for its own underfunded renewable projects.

This conflict of interest is precisely why South Africa must complete the long-delayed unbundling of Eskom, ensuring that the National Transmission Company of South Africa (NTCSA) becomes a fully independent transmission system operator outside of Eskom. The Electricity Regulation Amendment Bill mandates this, but implementation has been painfully slow, and the end-state even questioned by Eskom​.

In countries like Brazil, Chile, and India, independent transmission companies have unlocked billions in private investment​. South Africa cannot afford further delays — unbundling will allow transmission expansion to be properly financed and managed, creating a level playing field for all energy providers.

Solutions: What needs to happen now

To resolve South Africa’s energy crisis and attract much-needed investment in new generation, the country must urgently address the transmission bottleneck. The first and most pressing priority is to accelerate the build-out of transmission infrastructure. The NTCSA must be empowered to raise funds independently of Eskom and pursue public-private partnerships to develop new grid capacity at scale and speed.

The energy minister has recently instructed the NTCSA board to work positively with government in facilitating independent transmission projects. Without this, new renewable projects will remain stranded, unable to deliver power where it is needed most.

In recent years, annual transmission additions by Eskom have been less than 100km when, by its own estimates, 1,400km per annum is needed. A significant portion of new transmission infrastructure is already being funded and built by private independent power producers (IPPs), who subsequently transfer ownership to the NTCSA. This clearly illustrates the untapped potential of mobilising private capital and expertise to accelerate transmission expansion.

Equally critical is the need to fix the grid access process, which has been plagued by inconsistent application of rules, delays and a lack of transparency. The National Energy Regulator of South Africa (Nersa) must ensure that grid access policies are applied fairly and efficiently, with clear, non-discriminatory criteria that prevent bottlenecks in project approvals.

The grid access rules need significant updating to work effectively in a modern, competitive electricity market. Unlike in the past, new power projects are increasingly being developed without government-run procurement or direct agreements between buyers and sellers. The rules must reflect this new way of operating.

South Africa should adopt modern policies for managing electricity transmission. This includes new rules that allow renewable energy projects (such as wind and solar farms, along with energy storage) to share existing transmission lines more efficiently.

Under these policies, renewable energy projects can be managed flexibly, sometimes reducing their output when there’s congestion on the lines. This approach, called “curtailment”, would allow quicker connections of renewable projects without waiting for expensive and time-consuming upgrades to transmission infrastructure. Currently, the NTCSA has proposed using curtailment to manage congestion, but it is still awaiting regulatory approval from Nersa.

Finally, the long-delayed unbundling of Eskom’s transmission operations must be completed without further delay. Eskom’s financial distress and its dual role as both grid operator and competitor in power generation have created conflicts of interest that stifle investment and slow down grid expansion.

A fully independent transmission company is essential to ensuring a fair, competitive electricity market and restoring confidence in the sector. In the Strategic Plan of the Department of Electricity and Energy recently presented in Parliament, it was stated clearly that the transmission system operator (TSO) will be independent and outside of Eskom.

Work now needs to start on the founding legislation for the TSO, as well as obtaining the consent of lenders. Without decisive action on these fronts, South Africa will remain trapped in an entirely avoidable energy crisis.

The grid is the key to energy security

South Africa does not have an energy supply problem — it has a grid problem. The private sector is ready to invest, but without a functioning and independent transmission system, we will not escape load shedding.

If we fail to act, South Africa’s economic growth will remain stalled, energy costs will continue to rise and investor confidence will further erode. The country has no time left to waste — fixing the grid must be the national priority. DM

Dr Wikus Kruger is director of the Power Futures Lab at the Graduate School of Business, University of Cape Town.