31 July 2025

Government Launches Private Sector Tender for Critical Transmission Projects

The South African government has officially opened the pre-qualification tender for private sector investment in Independent Transmission Projects (ITPs), marking a significant step in the country's ongoing energy market reforms.

This development, announced on Thursday, aims to address one of the most critical bottlenecks in South Africa's energy system: the lack of transmission infrastructure needed to connect new generation capacity to the national grid.

Seven Transmission Projects Identified for Phase 1

According to the announcement, seven transmission projects have been identified for the first phase of the ITP Programme, with particular focus beyond the Cape regions. These projects are expected to reach implementation readiness in 2026, following the completion of the procurement process.

The National Transmission Company South Africa (NTCSA), Eskom's recently established transmission subsidiary, has been preparing these projects and will continue to develop them until they're ready for construction by the selected private sector partners.

Public-Private Partnership Approach

Eskom Group Chief Executive Dan Marokane described the tender as providing "clear, transparent policy framework designed to crowd in large scale private sector funding" through safeguards including "predictability and governance that enables developers to seamlessly start due diligence to bid competitively."

The initiative represents a significant shift in how South Africa's transmission infrastructure is developed and funded, moving from solely state-funded projects to a model that incorporates private sector investment and expertise.

Ministerial Collaboration

The ITP programme has been developed under the leadership of the Ministry of Electricity and Energy, in collaboration with National Treasury. The NTCSA has been supporting the initiative in several key areas, including:

• Strategic management and oversight
• Procurement processes
• Contracts and design requirements
• Legal and regulatory matters

Outlook: What This Means for South Africa's Energy Future

This tender represents an important step in addressing South Africa's transmission constraints, which have become a significant barrier to integrating new generation capacity, particularly from renewable sources.

While the pre-qualification tender is an encouraging development, the actual construction of these projects remains at least a year away, with implementation readiness targeted for 2026. The success of this initiative will depend on private sector appetite for these projects and the government's ability to maintain a consistent regulatory environment.

For ordinary South Africans, expanded transmission infrastructure could eventually mean greater grid reliability and the capacity to connect more renewable energy sources to the national grid. However, the immediate impact on loadshedding will be limited, as transmission expansion is just one piece of the country's complex energy puzzle.

Key Terms Explained

• Independent Transmission Projects (ITPs): Transmission infrastructure projects that are funded and built by private sector companies rather than solely by Eskom or the government.
• National Transmission Company South Africa (NTCSA): Eskom's transmission subsidiary that was established as part of the unbundling of Eskom into separate generation, transmission, and distribution entities. NTCSA is responsible for managing the national electricity grid.
• Transmission Development Plan: A strategic roadmap that outlines the planned expansion and strengthening of South Africa's electricity transmission network over a specific period.
• Pre-qualification tender: The initial stage of a procurement process where potential bidders are assessed on their technical capability, financial strength, and other criteria before they are invited to submit detailed proposals.