NERSA Confirms Eskom Transmission License Application to Spin Out National Transmission Company

The National Energy Regulator of South Africa (NERSA) has issued notice to all residents in the Republic of South Africa that Eskom had lodged the following applications:  

  • A National Transmission license
  • A Trading license
  • An Import/Export license

Currently, the Transmission business is licensed under Eskom Holdings SOC Ltd. The applications seek that the transmission business and assets owned by Eskom Holdings SOC Ltd be transferred to National Transmission Company (NTC) on the implementation date of the merger. Eskom Holdings SOC Ltd is willing to relinquish the transmission business role in favour of NTC.

Related news: Eskom unbundling into three divisions was announced by Cyril Ramaphosa in 2019

As at 31 March 2021, Eskom Transmission owned and operated 374 transmission lines with a total length of 33 199 km and 500 three-phase transformers with a total capacity of 159 384 MVA located at 169 transmission substations.

Related news: Eskom’s parent debt covenants hampering transmission unbundling 

NTC will procure energy, capacity and ancillary services from:

  • the Independent Power Producers (IPPs) as determined by the Minister of Mineral
  • Resources and Energy (under section 34 of the Electricity Regulation Act), including, but not limited to, the Renewable Energy Independent Power Producer Programme, the Peaker Programme and the Risk Mitigation Programme;
  • the IPPs contracted under programmes such as the Standard Offer and Emergency Generation Programmes instituted by Eskom Holdings; and
  • the Eskom Generation power stations as licensed by NERSA.

NTC will also sell energy and capacity to Eskom Distribution on an aggregated wholesale energy tariff structure that is calculated based on the regulatory revenue decision for Eskom Generation, inclusive of the IPPs and the international import allocation. Eskom Distribution will continue to sell power to other distributors, such as municipalities, until such a time when NTC concludes contracts with all distributors.

Currently, Eskom Holdings SOC Ltd conducts international imports and exports of electricity as a licensed activity based on Eskom’s Southern African Power Pool (SAPP) membership and Intergovernmental Agreements. The NTC Import/Export application will enable the continuation of import and export activities currently fulfilled by Eskom Holdings SOC Ltd. Eskom Holdings SOC Ltd is willing to relinquish this role in favour of the SAPP roles and obligations accruing to NTC.

The application can accessed HERE

Author: Bryan Groenendaal

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