On 4 April 2025, the South Africa Transmission Infrastructure Investment Forum brought
together key decision makers, including Minister of Electricity and Energy, Dr Kgosientsho
Ramokgopa, alongside industry leaders, financiers and developers. The forum laid the
groundwork for public-private partnerships (PPPs) in energy transmission, driven in part
by the Minister’s bold and pragmatic outlook.
An Urgent Case for Private Capital
With Bid Windows 6 and 7 leaving nearly 6GW of projects stranded due to lack of grid
access, the transmission bottleneck has become the Achilles’ heel of South Africa’s
energy transition. The Transmission Development Plan (TDP) outlines the need for 14 500
km of new transmission lines by 2034, requiring delivery to scale up to meet the required
average of 1 450 km/year from the current average of 300 km/year.
Recognising Eskom’s constrained balance sheet and limited implementation capacity,
the Department of Electricity and Energy (DoEE) has turned to the private sector to bridge
the gap through a new model: Independent Transmission Projects (ITPs), borrowing from
the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP)
that has unlocked over R300 billion in private investment.
A New Chapter in SA’s Infrastructure Investment
The ITP model sets the stage for 1 164 km of privately financed and operated transmission
lines in its first phase, unlocking over 3 200 MW in the Northern Cape, North-West and
Gauteng. These projects are late-stage (environmental and land permits largely
acquired,) making them bid-ready and ideal for near-term capital deployment.
The DoEE will manage the tender process, while the National Transmission Company of
South Africa (NTCSA) will be the only buyer.
Enter the Credit Guarantee Vehicle
To make these projects more bankable, National Treasury is launching the Credit
Guarantee Vehicle (CGV), a game-changer for PPPs in the infrastructure space. The CGV
will guarantee payment and termination risks, easing concerns over Eskom’s past off-take
reliability.
The CGV is targeting circa US$ 500 million in initial capital backed by blended finance
from global DFIs, including the World Bank, IFC, MIGA and JETP partners. Its AAA target
credit rating and independent governance model aim to lower the cost of capital, attract
blended finance and build investor trust, particularly for long-term Build-Own-OperateTransfer style concessions.
Why the Private Sector Should Pay Attention
This is not another pipe dream or policy draft. The draft Electricity Transmission
Regulations, released on 3 April 2025, formalise a legal framework for transparent
procurement, enforceable Transmission Service Agreements, and guaranteed cost
recovery. For developers, this provides commercial clarity. For investors, it reduces
regulatory fog. For energy contractors and manufacturers, it’s the birth of a pipeline with
significant forecasted local spend of R 390 billion over the next decade.
The roadmap is set, risk tools are in place, and the private sector is officially invited to
power South Africa’s energy future.
How can we help you?
As a trusted and experienced corporate finance advisory firm with deep expertise in
infrastructure finance, energy transactions and BEE structuring, Tamela is ideally
positioned to support private sector participants in navigating the ITP programme. Our
team can assist with end-to-end transaction advisory services – from financial modelling
to capital raising. We bring specialised knowledge in structuring bankable PPPs,
optimising risk allocation and aligning project financials with investor and lender
expectations.
For more information, contact Cwayita Kweyi on +27 11 783 4907 or cwayita@tamela.co.za.
