South Africa's Eskom to reduce power cuts but long-term outlook bleak

Eskom announced that its subsidiary National Transmission Company South Africa (NTCSA) has officially commenced trading, marking a major milestone in reforming South Africa's electricity sector.

Eskom's Board chairperson Mteto Nyati mentioned on Monday that the company's main goal will be to enhance capacity in South Africa's electricity network. The announcement was made through a joint media statement released by Eskom, NTCSA and the Department of Public Enterprises.

"We are pleased to announce that NTCSA begins trading today and will focus on increasing the capacity of the national transmission grid to allow the connection of much-needed new power generation capacity," Nyati said, SA News reported.

He added, "As a wholly owned subsidiary, it will operate under the direction of an independent board while providing open access to the electricity network, as envisaged during the unbundling process. We look forward to contributing to a more efficient and transparent electricity industry."

Chairperson of the NTCSA board Priscillah Mabelane mentioned that they are beginning a crucial journey with relevant departments, committing to continue focusing on ensuring safe, reliable and efficient operations.

He noted that the NTCSA will ensure non-discriminatory access to the transmission network and find ways to accelerate the rollout of the transmission grid while fostering transparency and efficiency.

"Together, we look forward to shaping a dynamic electricity market," Mabelane said, extending deepest gratitude to Eskom, the Inter-Governmental Steering Committee comprising of the Department of Minerals and Energy, National Treasury and the Shareholder Representative, DPE teams for their support in achieving this milestone.

According to the statement, the entity will "own and operate the country's national transmission system, the world-class System Operator, the grid strengthening function, energy market services and the International Trader."

NTCSA has been granted three licenses by the National Energy Regulator of South Africa (NERSA). The license makes NTCSA the operator and manager of the transmission grid, trader of energy as procured by the Minister of Mineral Resource and Energy as well as importer and exporter of energy to and from the Southern African Power Pool (SAPP).

The entity will act as the Transmission System Operator and buyer while it will also assume additional roles once the Electricity Regulation Amendment (ERA) Bill is passed into law. Furthermore, it will serve as a platform for generators, consumers, traders and retailers to trade with one another.