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South Africa has delayed the final tender for its first privately delivered electricity transmission projects until the second quarter of 2027, extending a timetable previously set for 2026.
Bankability takes priority
The Department of Electricity and Energy and National Treasury said a final request for proposals will follow another draft tender package and focused consultation with seven pre-qualified bidders before the end of 2026.
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Officials said the revised schedule is intended to ensure the country’s first Independent Transmission Projects are commercially workable and capable of attracting competitive bids. The programme is a test case for bringing private-sector finance and delivery capacity into the expansion of South Africa’s national grid.
The government had previously indicated that the final request for proposals would be released by the third quarter of 2026. The new target moves the decisive tender stage into Q2 2027.
Credit guarantees remain central
A major factor is the development of a Credit Guarantee Vehicle, designed to provide investors and lenders with greater assurance around payment and termination risks.
The government said the vehicle was incorporated on 12 August 2026 after a joint development agreement between National Treasury and FSD Africa was signed on 2 July. Prospective capital providers conducted due diligence from 28 September to 2 October, while the vehicle’s licensing application is being processed by the South African Reserve Bank’s Prudential Authority.
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A non-binding term sheet is expected to accompany the next draft tender documents. Further due diligence is planned for the first quarter of 2027, with a binding term sheet targeted by the end of that quarter.
Grid expansion and energy access
Phase I of the Independent Transmission Projects programme covers about 1,164 kilometres of new transmission infrastructure. The planned lines are intended to help connect additional electricity generation, including renewable power, to homes, businesses and industry.
For Black South Africans, the outcome matters beyond the technical details of procurement. Grid bottlenecks have constrained the country’s ability to add new generation and support reliable electricity supply, with direct consequences for households, township businesses, manufacturers and job creation.
Government argues that a more robust first-round framework could create a longer pipeline of investment, supporting local construction, equipment supply, skills development and industrial activity. But the delay also means that the infrastructure needed to unlock new power capacity will take longer to reach the binding-bid stage.
The seven shortlisted groups were selected through the programme’s pre-qualification process in December 2025. The Department of Electricity and Energy said it will continue engaging them as it completes the procurement and guarantee arrangements.
Why it matters
South Africa’s power system needs substantially more transmission capacity to carry new generation from resource-rich areas to demand centres. The revised timetable reflects the state’s judgement that a flawed first private-grid tender would pose a larger long-term risk than a delay.
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The next test will be whether the government can convert the extended preparation period into tender terms that lenders can finance, bidders can price and the public can scrutinise.