South Africa’s energy transition entered a new phase this week with the launch of Eskom Green, a dedicated renewable energy business that will sit inside Eskom before eventually becoming a standalone subsidiary.
The announcement is bigger than a corporate restructuring exercise. It reflects a reality confronting utilities around the world: the business of building renewable energy does not operate like the business of running coal-fired power stations.
For decades Eskom generated electricity, transmitted it and sold it through a vertically integrated model. Renewable energy operates differently. Projects often require partnerships, project finance structures, specialised investors and faster commercial decision-making. Eskom Green is being built to operate in that environment.
The company plans to focus initially on large industrial customers in mining and manufacturing. These businesses face increasing pressure from export markets, investors and customers to reduce carbon emissions. Many are now actively seeking renewable electricity solutions without compromising reliability.
Eskom Green’s answer is straightforward. Rather than simply selling renewable electricity, it intends to provide bundled energy solutions combining solar, battery storage, pumped hydro and other firming technologies to support around-the-clock power requirements.
The timing is significant. Since the introduction of South Africa’s renewable energy programme more than a decade ago, only about half of awarded projects have ultimately reached construction. Eskom argues that stronger coordination is needed if South Africa hopes to meet the targets outlined in the Integrated Resource Plan 2025.
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The utility expects to have approximately 6GW of renewable and storage capacity available by 2030 and is targeting as much as 32GW by 2040 through a combination of public-private partnerships and project-specific financing vehicles.
The launch also reveals how Eskom increasingly sees its future. Coal will remain important for years, but the utility is no longer positioning itself solely as a coal generator. It wants to become a participant in South Africa’s renewable energy market rather than merely a facilitator of it.
The success of Eskom Green will ultimately depend on execution. South Africa does not lack renewable energy ambitions. It lacks enough projects moving from announcement to operation.
By Thuita Gatero, Managing Editor, Africa Digest News.
