South Africas electricity sector entered 2025 with a wave of structural reform but 2026 is shaping up to be the year those reforms face their first real implementation test. Market rules are nearing finalisation, new infrastructure procurement models are emerging and long-discussed technologies such as battery storage are shifting from future option to present necessity. The coming year will reveal whether institutional readiness, regulatory clarity and investment appetite are aligned strongly enough to support a competitive, modernised power system, says Mzukisi Kota , Mlungisi Mahlangu , Jason van der Poel , Kiera Bracher , Sabeeha Loonat and Junaid Nyker from Webber Wentzel.
The coming into force of the Electricity Regulation Amendment Act ERAA on 1 January 2025 marked a decisive shift away from South Africas historic vertically integrated model. The establishment of a transmission system operator responsible for system and market operation introduces the foundation for a multi-participant electricity market.
While the ERAA provides the legislative architecture, practical questions remain around tariff oversight, the role of municipalities and the interpretation of direct supply agreements. Institutional alignment across national government, the National Energy Regulator of South Africa NERSA, Eskom and organised local government will be critical in determining whether reform momentum is sustained or slowed by jurisdictional friction.
