Major South African companies, including a top university, kissing Eskom goodbye
The University of Cape Town has joined other major companies and institutions across South Africa in shifting their reliance from Eskom’s power grid to private renewable energy.
A combination of rapidly rising electricity prices and declining reliability has driven major retailers and mining giants away from the state utility.
The Competition Commission of South Africa revealed in April that households in the country were spending 85% more on electricity than they were six years ago.
Data from the commission’s latest cost-of-living report showed skyrocketing electricity prices from Eskom, the state-owned and largest power generator in the country.
In March, the National Energy Regulator of South Africa (Nersa) approved an additional average increase in electricity prices of 8.76% for customers supplied directly by Eskom.
“The new tariffs will apply from 1 April 2026 for Eskom direct customers. Municipal bulk purchasers will implement their tariff increases, averaging 9.01%, from 1 July 2026,” Eskom said.
It added that the tariff increase was aimed at supporting Eskom’s ability to provide a stable and reliable electricity supply to households and businesses in South Africa.
Companies have taken note of the steep increases and are investing in renewable energy, either of their own infrastructure or from private providers.
In January, retail giant Shoprite announced it had installed 100 solar photovoltaic (PV) systems across its brick-and-mortar footprint.
The group owns brands such as Checkers, Shoprite, Usave, OK, and Medirite, and said it had an installed solar capacity of over 43,300kWp.
By January, Shoprite reported that its solar portfolio was among the largest of any South African private company.
Mining giant Sibanye-Stillwater revealed plans to build a 50MW PV plant to supply power to its Kloof mine in Gauteng. Eskom immediately sought to block this plan, citing distribution concerns.
According to court documents, Eskom stood to lose around R57 million per year if the mine, one of the largest gold operations in South Africa, went off-grid and relied on its own power supply.
The University of Cape Town signs landmark private power agreement
The University of Cape Town (UCT) announced in June that it signed a long-term renewable electricity supply agreement with Discovery Green, a licensed energy trader in South Africa.
It said that the agreement represented the first long-term power purchase agreement between an energy trader and a public university in South Africa.
Under the agreement, Discovery Green will convert 70% to 90% of the electricity consumption of UCT’s main and health sciences campuses to renewable energy.
“This is expected to reduce the university’s carbon emissions by an estimated 33,200 tonnes of CO₂ equivalent each year,” it said.
UCT said that it signed a 10-year contract with Discovery Green, with supply set to begin in the third quarter of 2027.
It said that supply will be provided by Amplu Energy, a joint venture between Discovery Green and energy giant Sasol, established in April 2025.
“By replacing the majority of electricity demand across these campuses, the agreement makes a material contribution to UCT’s climate and sustainability objectives,” it said.
“It supports the reduction of Scope 2 emissions associated with electricity consumption and aligns with the university’s long-term environmental sustainability strategy.”
Andre Nepgen, CEO of Discovery Green, said that South African organisations are facing an increasingly complex energy environment with rising costs and electricity supply constraints.
He said the shift to private renewable energy is becoming essential, especially as many organisations also seek to reduce their carbon footprint.
“The agreement demonstrates how public institutions can use long-term renewable energy procurement to address energy constraints, cost volatility and decarbonisation objectives,” UCT said.
Since UCT has limited roof space for solar PV, thanks to its older buildings, it will receive renewable private electricity from various solar and wind farms via Discovery Green’s wheeling agreements.
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