Acting early is now a competitive advantage in South Africa’s renewable energy market, writes Discovery Green CEO, Andre Nepgen.
For large energy users in South Africa, 2026 isn’t the year to sit on the sidelines and deliberate. It’s emerging as a pivotal year, as reform, cost dynamics and grid constraints converge to reshape how renewable energy is procured, priced and accessed. Timing has become a defining factor in securing reliable, affordable and long-term renewable energy supply.
The question is no longer whether renewable energy will become central to industrial power supply in South Africa. The question is who secures access early enough to benefit from it. For a long time, energy decisions have been crippled by uncertainty, stemming from unstable supply, evolving regulatory environments and a constrained grid, as well as a broader hesitation around renewables when they were still new and poorly understood.
Electricity reform
However, the environment is changing. Electricity reform is moving from principle/idea into action. Clearer governance structures, maturing wheeling frameworks and greater standardisation across utilities is allowing organisations to act with more certainty. Rather than waiting for future market structures, large energy users can already access scalable trader-led, portfolio-based solutions that simplify contracting and manage risk through aggregation.
Global cost pressures
At the same time, global cost pressures are reshaping assumptions about renewable pricing. The anticipated removal of China’s 9% VAT export rebate on solar modules from April 2026, combined with rising input costs and strong global demand, is driving hardware prices upward. Locally, the National Energy Regulator of South Africa (NERSA) has approved electricity tariff increases of 8.76% in 2026 and 8.83% in 2027, further reinforcing the rising cost of inaction. Early movers are better positioned to secure favourable pricing and protect long-term project economics.
Grid constraints
Grid access has become the most significant structural constraint. With the Eastern, Western and Northern Cape effectively out of firm capacity and a 53GW backlog of private renewable projects awaiting connection, timelines are tightening. Interim measures such as congestion curtailment offer partial relief, allowing controlled reductions in output of around 4%.
Long-term solution
However, the long-term solution lies in transmission expansion at scale. South Africa needs around 14 500km of new high-voltage lines by 2034 to unlock the next phase of renewable growth. The challenge is not a shortage of projects or investment appetite. It is the pace at which new transmission can be delivered. In fact, Discovery Green notes that some new private-sector renewable projects today are forecasting first power only in 2031, simply because the grid cannot accommodate them sooner. For businesses still undecided, this means that “waiting” has a very real cost: it can add half a decade or more to their access to renewable energy.
These shifts are creating renewed urgency for strategic, board-level decision-making. Passive observation is no longer a viable option. The organisations that move decisively, before grid constraints deepen and costs accelerate, will be the ones with the most room to manoeuvre as the next decade’s energy constraints and opportunities unfold.
In the years ahead, renewable energy will increasingly be defined not only by cost or sustainability credentials, but by access. And in 2026, access is becoming a race against time, one that will lock in competitive advantage for early movers, and lasting constraints for those who hesitate.
Discovery Green, backed by the scale and actuarial expertise of the Discovery Group, is a licensed energy trader operating a proprietary renewable energy platform for South African businesses. The platform applies actuarial modelling to design and optimise diversified wind and solar portfolios, replacing on average 90% of a client’s electricity demand with cost-effective, price-certain renewable energy.
Through long-term power purchase agreements with some of the country’s largest renewable energy plants, Discovery Green aggregates supply, optimises coverage against client load profiles and delivers long-term price certainty, regulatory compliance and measurable decarbonisation at scale.