Renewable energy + industrial sustainability
In South Africa’s business board rooms today, the energy conversation is generally filled with optimism, big ideas and some bold timelines. On the ground, we know the market moves in its own time, and in a more practical way. The realities shaping 2026 are already playing out in how projects are financed, how municipalities procure power, and how businesses think about energy risk. Here are five energy market realities that will inform how we, as an industry, operate in 2026. Five energy market realities in 2026 David McDonald, CEO at SolarAfrica
David McDonald, SolarAfrica.
The wholesale market still hinges on Eskom Over the past year, there has been a great deal of talk around the South African Wholesale Electricity Market (SAWEM). And while it might sound like we’re about to press play, the reality is that without the participation of all stakeholders, a wholesale market won’t function. Currently, Eskom supports the concept of an open market, although it appears still to be hedging its bets by building and controlling its own virtual wheeling platform. Private otakers and independent power producers (IPPs) will continue to align themselves – at least in the short term – with the state-owned entity because it’s where bankability exists. This is significant because key stakeholders such as developers, customers and banks are watching and responding to what exists today. Projects are being financed and built using Eskom-approved structures, and nobody is holding projects back waiting for a market that may or may not arrive on schedule. I believe a wholesale market is in the best interests of South Africa’s energy landscape, and it will play a role in future. But in 2026, most private power activity continues to sit outside that debate.
Municipalities buying power directly – the path of least resistance 2025 proved that wheeling is viable at scale and o ers a lot of advantages, yet many municipalities are choosing a more straightforward route: buying power directly from IPPs. In the Western Cape, the Swartland and George municipalities are two examples of municipalities that have recently stated their intention to source electricity directly from power producers. In KwaZulu-Natal, eThekwini Municipality was the first SA metro to secure ministerial approval to buy significant capacity from IPPs. For these municipalities, wheeling brings administrative and financial complexity, where direct procurement – in contrast – is easier to implement and increasingly easier to finance. Moreover, changes to Eskom’s Electricity Supply Agreement have made these structures more rigorous and, in some cases, more challenging for municipalities. As a result, we expect the market to become even more fragmented in 2026. Energy decisions move out of operations onto the balance sheet In 2026, energy is no longer treated as solely an operational cost. For many large users, it now moves onto the balance sheet
SunCentral is one of the country’s largest solar initiatives designed specifically for one-to-many bilateral wheeling.
14 Electricity + Control MARCH 2026
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