Client or partnering organisation:
– Bureau for Economic Research (BER).
– Towards Inclusive Economic Development (SA-TIED)/ UNU-WIDER – United Nations University World Institute for Development Economics Research
Overview and impact:
This research serves as a pivotal component of the national structural reform agenda driven by Operation Vulindlela, tackling one of South Africa’s most severe economic constraints: energy security. Authored by the head of Tregathen Consulting, Robert Botha, in partnership with the Bureau for Economic Research (BER), the project delivers a definitive analysis of the 2020 regulatory reforms that originally permitted municipalities to procure electricity directly from Independent Power Producers (IPPs). By rigorously investigating why, by early 2025, not a single municipality had successfully added new long-term capacity to the grid, this study provided a deep understanding of reform challenges. It exposes the critical disconnect between regulatory intent and execution, providing policymakers with the essential diagnostic needed to evaluate reforms of South Africa’s energy sector.
The reports provide an exhaustive evaluation of the systemic hurdles that paralysed local government procurement of power from IPPs, ranging from complex regulatory bottlenecks to the deep financial distress of existing municipal distribution grids. By demonstrating that the national energy transition cannot succeed without a fundamental reassessment of municipal funding models, the research shifts the debate beyond generation capacity to structural viability. This project provides a clear, evidence-based roadmap to resolve these binding constraints, offering actionable pathways to decentralise power procurement, alleviate the burden and dependency on Eskom, and ultimately drive sustainable economic growth.
Download Reports/Products:
Powerless to Procure? Understanding municipal power procurement from IPPs
What stops municipalities procuring their own power?
