Primary briefing · Gazette
high impact 55226 · 2026-08-21
Electricity Sector Market Transformation Position Paper — SAWEM wholesale market proposed
Comment closes
20 Sept 2026
The Department of Electricity and Energy has published a position paper proposing the creation of a competitive South African Wholesale Electricity Market (SAWEM). The paper envisages a centralised trading platform with unbundled generation, transmission (via a National Transmission Company of South Africa), distribution, and retail segments. It contemplates vesting contracts, eligible wholesale and retail customer thresholds, market power controls, and participation by generators, traders, and eligible customers. The reform would fundamentally restructure how electricity is procured by large industrial and commercial users, IPPs, and municipalities. Written comments are invited within 30 days of publication.
Who is affected
Electricity generators and independent power producers (IPPs)Municipalities acting as electricity distributorsLarge industrial and commercial energy usersEnergy regulatory practitionersInfrastructure and project finance advisors What this means for practitioners
Review the full position paper and assess client-specific exposure to the proposed SAWEM structure, including unbundling, vesting contracts, and eligible customer thresholds
Submit written comments to the Department of Electricity and Energy by approximately 20 September 2026 (30 days from 21 August 2026)
Brief energy-sector clients — particularly IPPs, large offtakers, and municipal distributors — on the proposed market design and its implications for existing power purchase agreements and procurement strategies