- Government extends deadline for high level restructuring proposal to June 2026.
- Independent state owned Transmission System Operator expected to drive electricity market competition and unlock grid investment.
- Reform aims to strengthen energy security while ensuring non-discriminatory access to South Africa’s transmission network
South Africa has taken another step towards restructuring its electricity sector, with the Eskom Restructuring Task Team (ERTT) reporting significant progress in preparations for the establishment of a fully independent, state owned Transmission System Operator (TSO).
The reform initiative follows President Cyril Ramaphosa’s announcement during the 2026 State of the Nation Address that government would establish a dedicated task team to oversee Eskom’s restructuring and facilitate the creation of an independent transmission company responsible for owning and operating the national transmission network and electricity market.
The ERTT, which comprises representatives from the Presidency, National Treasury, the Department of Electricity and Energy, Eskom and the National Transmission Company South Africa (NTCSA), has been working since March 2026 to develop the framework for the new entity. The task team is chaired by the Director General of National Treasury.
Although the team was initially expected to submit its high level recommendations by the end of May 2026, the President has extended the deadline to the end of June to allow for further refinement and consideration through the appropriate governance processes.
President Ramaphosa welcomed the progress made by the task team, describing the establishment of an independent transmission company as a critical reform for South Africa’s energy sector.
He said the new entity would support the introduction of a competitive electricity market while helping to ensure a reliable, affordable and sustainable electricity supply capable of supporting economic growth.
The move aligns South Africa with international electricity market reforms implemented in more than 90 countries, where transmission ownership and system operation have been separated from incumbent generation companies to eliminate conflicts of interest and ensure fair treatment of all market participants.
South Africa’s Electricity Regulation Act requires the establishment of an independent TSO by no later than 31 December 2029. Until then, these functions will continue to be performed by the NTCSA, Eskom’s transmission subsidiary established in July 2024.
The task team has been mandated to develop a detailed proposal and implementation plan for creating a standalone transmission company that will assume ownership and control of transmission assets, operate the electricity market, facilitate large scale grid investment and provide open access to the network.
It is also evaluating the most appropriate institutional model for the TSO based on international best practice while ensuring compliance with the Electricity Regulation Act. In addition, the team is considering measures to strengthen the operational independence of the NTCSA during the transition period and to ensure transparent and non discriminatory allocation of grid capacity.
According to its terms of reference, the restructuring process must maintain energy security, guarantee the TSO’s independence from all market participants and separate transmission assets from Eskom ownership. The process must also ensure that Eskom’s financial position is not weakened, that the future TSO remains financially sustainable and capable of raising capital for transmission infrastructure expansion in line with South Africa’s Transmission Development Plan.
Government has further emphasised the need to minimise any impact on the national fiscus and electricity consumers while supporting broader electricity market reforms, including the introduction of Independent Transmission Projects.
The restructuring programme will be implemented in two phases. The first phase, expected to conclude at the end of June 2026, will deliver a high level proposal for establishing the TSO. A second phase, scheduled for completion within three months thereafter, will focus on developing a detailed implementation roadmap and timelines for executing the restructuring process.
The establishment of an independent transmission operator is widely regarded as one of the most significant reforms in South Africa’s electricity sector, with the potential to accelerate grid expansion, improve investor confidence and support the integration of new renewable energy generation capacity.
Author: Bryan Groenendaal
