South Africa is on the cusp of starting a traded electricity market that will give consumers a choice of power products along with a range of pricing options, according to a top investment bank.
Africa’s most industrialized economy has relied on state-owned Eskom Holdings SOC Ltd. for the bulk of its electricity supply for more than a century.
Mismanagement and underinvestment at the utility led to record outages in 2023, causing government to allow private companies to build power plants of any size to meet their own needs and to sell to the grid.
Now the country has opened the market to licensed traders, an area FirstRand Ltd. unit Rand Merchant Bank is backing.
“It’s the beginning of a traded electricity market in South Africa,” Judy Kobus, head of infrastructure sector solutions at RMB, which is providing financing solutions to traders, said in an interview in Johannesburg.
South Africa’s energy regulator has so far licensed 10 traders, who will create a market-orientated pricing structure that will allow consumers to choose their own electricity supplier based on price.
To read the full Business Tech article click here.
[Image credit: businesstech.co.za]
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