Primary briefing · Gazette
high impact 54738 · 7512 · 2026-05-25
NERSA wholesale electricity pricing methodology — SAWEM tariff architecture open for comment
Comment closes
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Government Notice 7512 publishes NERSA's consultation paper on the Wholesale Electricity Pricing Methodology for the South African Wholesale Energy Market (SAWEM). The paper sets out the full regulated tariff structure for the transition from a vertically integrated single-buyer model to a competitive multi-buyer framework. It details time-of-use energy charges, generation capacity charges, transmission use-of-system charges, ancillary service charges, loss factors, and cross-subsidy charges. Legacy charges — recovering costs of existing Section 34 PPA obligations — are expressly non-avoidable and payable by all market participants and balance responsible parties. Licensed distributors' wholesale or retail trading arms must conclude Vesting Contracts with the Central Purchasing Agency before participating in the wholesale market during a transition period anticipated at 5 to 10 years. Transmission-connected customers cannot avoid cross-subsidy contributions. The methodology applies for the MYPD6 period or until replaced by new NERSA methodologies.
Who is affected
Electricity generators (Eskom Generation and IPPs, including REIPPPP participants)Licensed electricity distributors and municipal distributorsElectricity traders and retailersBalance Responsible PartiesTransmission-connected industrial loads and power-intensive users (mining, smelting)Energy project developers and investorsEnergy regulatory practitioners What this means for practitioners
Submit written comments to NERSA by 26 June 2026 at 16:00 — this is the only formal comment window before the methodology is finalised.
Register for the virtual public hearing scheduled for 1 July 2026 via MS Teams.
Assess the financial impact of non-avoidable legacy charges and cross-subsidy obligations on generator and large-consumer clients.
Advise licensed distributor clients on the mandatory requirement to conclude Vesting Contracts with the Central Purchasing Agency before wholesale market participation during the transition period.
Review whether existing PPA and offtake arrangements align with the proposed tariff components and transition mechanisms.