Photo: Waldo Swiegers / Bloomberg via Getty Images) 
South Africa’s electricity salvation is called the Independent Transmission Projects (ITP) Programme – a joint venture between Kgosientsho Ramokgopa’s Department of Electricity and Energy and Enoch Godongwana’s National Treasury – and it’s racing the clock to unlock billions in private investment and build the 14,000km of new transmission lines needed to connect renewable energy projects and end the country’s electricity crisis.
style="font-weight: 400;">Speaking to the parliamentary committee on electricity and energy last week, Minister of Electricity and Energy Ramokgopa painted a picture of a country on the cusp of an energy revolution, but one that required unprecedented national rewiring coordination between government, the private sector and state-owned entities to succeed.
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Ramokgopa knows the stakes. It was his Integrated Resource Plan that estimated a desperate need of more than 14,000km of new transmission lines and 170 transformers over the next decade – requiring a minimum of the N1 road length from Joburg to Cape Town’s worth of new lines annually – South Africa’s current grid expansion pace is “wholly inadequate”, according to government briefings.
Private sector rush
The appetite for private sector involvement is clear. Between December 2024 and February 2025, the government conducted a request for information that received more than 130 formal responses from local and international developers, financiers, operators and equipment manufacturers.
More than 44% of local participants indicated they intended to partner with international entities, suggesting the scale of investment required exceeds domestic capacity alone.
The feedback was instructive: the industry reported a need for stable regulatory frameworks and a programmatic roll-out for pipeline predictability, while also flagging permitting, right-of-way acquisition and supply chain constraints as key risks requiring proactive mitigation.
The government listened.
First came the ministerial determination, gazetted on 28 March 2025, designating the Department of Electricity and Energy as the procurer and the National Transmission Company South Africa (NTCSA) as the buyer under Transmission Services Agreements. The determination defines Phase 1 scope as 1,164km of 400kV transmission lines across the Northern Cape, North-West and Gauteng.
Expropriation trump card
Next came the Draft Electricity Transmission Regulations, on 3 April, with public consultation closing on 22 May. The IPP Office will run the Phase 1 procurement, with pre-qualification tenders expected by end-July and requests for proposals by November.
A persistent obstacle that the NTCSA inherited from Eskom is the complexities of securing land for its transmission lines. Ramokgopa confirmed that expropriation with compensation would be used “as a final instrument” after exhausting other engagement options.
For ITP projects, the government aims for “late-stage tender” – resolving land acquisition, environmental impact assessments and statutory authorisations before developers take over execution, de-risking projects for private investors.
Some discussions have stretched over four years without resolution, but the NTCSA says it is committed to meticulously adhering to proper procedures to mitigate the risk of litigation as it navigates these challenging negotiations.
The R440bn funding puzzle
The Transmission Development Plan requires R440-billion over the next decade. Ramokgopa was blunt about the funding reality: “The sovereign balance sheet cannot provide a blanket sovereign guarantee for this investment, nor are Eskom’s or NTCSA’s balance sheets strong enough alone.”
The government’s solution is a “bespoke financing instrument” backed by a Credit Guarantee Vehicle (CGV) developed with the World Bank. The CGV will be incorporated as a private non-life insurance company in South Africa and is expected to become operational in 2026.
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For the first five years, R155-billion will be spent on transmission infrastructure, with R30-billion expected from third-party debt by 2028. NTCSA’s board has increased its five-year budget by about R40-billion to R130-billion, with 76% allocated for network expansion.
A R219-billion provision from Budget 3.0 (part of the R1.03-trillion medium-term expenditure framework) was noted for strengthening the electricity supply network, from generation to transmission and distribution.
Supply chain nationalism
Ramokgopa pointed to the government’s intention to build local industries on the back of energy investments rather than “exporting opportunities”. The Department of Trade, Industry and Competition is coordinating interventions to ensure local production of Class 4 transformers and steel.
The progress is evident: 22 factories have been accredited for various transformer classes, while five of six identified steel tower suppliers have been certified. Eskom announced a panel of transformer suppliers in June 2024 to address demand for 101 large transformers over the next decade.
Racing against time
With the competitive electricity market targeted for April 2026 and the Credit Guarantee Vehicle becoming operational the same year, timelines are tight. The NTCSA is simultaneously developing market codes, managing infrastructure roll-outs and preparing for its role as market operator once the Electricity Regulation Amendment Act is passed.
The South African Wholesale Electricity Market School will launch at Wits Business School to build market participant capabilities, while synchronous condensers are planned to strengthen grid stability as renewable penetration increases.
That said, for the first time in years, South Africa has a comprehensive plan, committed funding mechanisms and private sector interest to transform its electricity system. Whether it can execute fast enough to meet the 2026 competitive market deadline – and finally end load shedding – remains the R440-billion question. DM