The Khi Solar One solar plant in South Africa’s Northern Cape. Hp.Baumeler South Africa is moving away from coal-fired electricity, which currently supplies 74% of the country’s power, to wind and solar energy. But as the country’s experience shows, the transition is complex and is being slowed down.
This is because renewable energy works very differently from coal. It needs a different kind of electricity system and new ways of planning and managing the grid.
The transition also requires major changes at the state-owned electricity utility, Eskom, which has long dominated South Africa’s power sector. It involves transforming an electricity system built around a few large coal-fired power stations into one that can absorb power from many renewable energy producers while keeping electricity reliable, affordable and accessible.
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I’ve been working in the field of energy and economic regulation in South Africa for 40 years. I sat on the Eskom board for six years until I resigned in 2024 and I was involved in drafting key energy policies.
Based on my experience, I argue that there are five key factors slowing down the energy transition:
inconsistent and politically driven government electricity planning, favouring certain technologies and restricting private energy providers
a grid that has not been designed to keep up with technological change
crumbling municipal electricity distribution networks and high levels of local government debt to Eskom
inability of rooftop solar to sell surplus power into the grid.
These five problems are closely linked to slow-moving institutions, outdated ways of thinking, poor management and corruption. Many countries face similar challenges, but South Africa is a politically fractured society, with low trust in government, weak education systems and high rates of crime. All this shows in the slow pace of the energy transition.
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The slow pace comes at a cost. Communities living near coal-fired power stations continue to face health risks. And South African exports could become less competitive as the European Union introduces border taxes on products produced with coal-fired electricity. The country’s coal-fired power stations continue to produce high levels of greenhouse gas emissions that drive climate change.
I have ranked the factors slowing the transition from most to least influential. Others may rank them differently.
The first bottleneck is Eskom: state-owned and slow to respond to change. It controls electricity generation, transmission and distribution. Because it controls so much of the system, Eskom has had the power to influence who can connect to the grid and how quickly new competitors can enter the market.
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Eskom is also struggling financially. As more households and businesses generate their own cheaper solar power, its sales have declined. It has tried to slow down the energy transition by challenging licences for electricity traders and by resisting plans to make the national transmission grid fully independent.
It has also backed expensive coal projects. In 2024, Eskom decided to extend the lives of the Camden, Grootvlei and Hendrina coal-fired power stations until 2030 at a cost of about R90 billion (about US$5.5 billion). That money could instead have gone towards new renewable energy projects that would have lasted much longer.
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The second bottleneck is the government’s electricity plans (known as Integrated Resource Plans). They are supposed to set out the cheapest ways of providing the country with the electricity it needs. But instead, the government uses them to pick technologies that it prefers, like nuclear and gas, over cheaper renewable energies.
