Adrian Gore's Discovery Green Faces Legal Challenge From Eskom Over Trading License

Eskom challenges Nersas licenses, citing a lack of consultation and regulatory rules in South Africas evolving power market.

Discovery Greens deal with Southern Sun raises concerns over private traders bypassing Eskoms redistributive obligations.

Eskom argues private energy traders threaten grid stability and cherry-pick profitable clients without supporting municipal debts.

South Africas state-owned power utility, Eskom, has gone to court to stop electricity trading licenses granted to Discovery Green the renewable energy arm of Adrian Gores Discovery Group along with five other private firms. Eskom argues the move puts the national grid at risk and opens the door to unfair competition.

The case, filed at the Gauteng High Court, takes aim at the National Energy Regulator of South Africa Nersa , which approved the licenses. Eskom claims the regulator pushed the approvals through without proper rules in place or input from the public. According to the utility, the new traders are being allowed to cherry-pick its most profitable customers while sidestepping the responsibility of supporting municipalities struggling with unpaid electricity bills.

The dispute comes shortly after Discovery Green signed a 10-year power purchase agreement with hospitality group Southern Sun to supply renewable energy to seven flagship hotels across the country. The deal will channel wind and solar energy through the national grid to properties including the Arabella Hotel Spa and Drakensberg Sun Resort.

Eskom claims such agreements, under the current regulatory vacuum, could destabilize South Africas electricity system. Legal executive Mohlago Masekela said in filings that Nersas approvals constitute a fundamental change in policy and may upend the entire landscape of electricity provision. Eskom says the systems integrity is at risk if traders can operate freely in profitable areas, undermining the utilitys ability to recover costs or maintain service in less attractive markets.

The utility argues that the current trading regime lacks mechanisms to manage tariffs, market access, or overlapping supply in the same regions a violation of existing distribution rules. Eskom estimates municipal debt owed to it has exceeded R100 billion 5.5 billion and insists traders should help shoulder the burden through mandated cross-subsidies.