Ramaphosa endorses Phase I of Eskom restructuring to enable independent grid operator

President Cyril Ramaphosa has endorsed the Phase I report of the Eskom Restructuring Task Team (ERTT), a move the Presidency says will pave the way for an independent Transmission System Operator (TSO) and a more competitive electricity market.

What the endorsement means

Presidential spokesperson Vincent Magwenya said on Friday, July 31, 2026, that Ramaphosa had endorsed the ERTT’s Phase I report, which sets out recommendations for establishing an independent Transmission System Operator separate from Eskom. The report was presented to the president by the task team on July 30, 2026.

The Presidency framed the endorsement as enabling reforms to “create competition, unlock investment, reduce electricity prices and ensure energy security for sustained economic growth and job creation.”

Scope and next steps

Magwenya said Phase II will start immediately and will focus on developing the detailed transaction structure and implementation plan. The Presidency said Phase II will proceed “over the next three months.”

Immediate actions identified

The Phase I analysis, as summarised by the Presidency, included:

• An analysis showing the restructuring is feasible, aligned with international best practice, and can be done without compromising Eskom’s financial sustainability.
• A warning that growth in municipal arrear debt to Eskom must be addressed because of the threat it poses to Eskom and the broader electricity sector.
• Identification of several actions that could be taken immediately to enable the restructuring.

Interim measures and governance changes

Among the interim actions the ERTT proposed were measures to strengthen the National Transmission Company of South Africa’s (NTCSA) independence and to internally ring-fence its licensed activities. The report also recommended governance safeguards, including that “Directors serving on the Eskom board will not be appointed to the board of the NTCSA, or serve on the boards of both the NTCSA and Eskom.”

Other governance proposals in Phase I include that the appointment of the NTCSA chief executive officer and senior management “will be the sole responsibility of the NTCSA board,” and a “clear delegation of authority from Eskom to the NTCSA of all decision-making related to the market, financial and operational ring-fencing of NTCSA from Eskom.”

The report said decisions on access to the transmission network are to be relocated to the NTCSA and eventually to the TSO. It also said “Eskom Distribution will retain a Grid Access Unit to manage connections to its distribution network where projects connect at this level.”

Measures to tackle municipal arrears and market protections

The ERTT proposed a working group to develop a consolidated action plan to arrest the growth in municipal arrears and to identify initiatives to scale up. Suggested measures include:

• Stronger enforcement of credit controls
• Rolling out smart meters and Distribution Agency Agreements (DAAs)
• Stricter licence enforcement
• Continued implementation of the Municipal Debt Relief Programme, Metro Trading Services Reform and the Electricity Distribution Industry (EDI) Reform Roadmap

Ramaphosa’s view

“I am encouraged by the speed and diligence with which the task team has taken forward this important task,”

“The establishment of a fully independent transmission company is a critical reform which will support the introduction of a competitive electricity market and ensure a reliable, affordable and sustainable electricity supply to power the economy.”

Stakeholder concerns

IOL previously reported that the National Union of Mineworkers (NUM) has voiced opposition to the proposed transfer of transmission assets to an independent TSO and is calling for urgent labour consultation before further steps are taken.

The task team was established in March 2026 and includes representatives from the Presidency, National Treasury, the Department of Electricity and Energy, Eskom, and the NTCSA. The Presidency had earlier extended the task team’s deadline to finalise its report on the creation of a TSO to the end of June 2026.

Phase II will develop the detailed transaction structure and the implementation plan identified in Phase I, and the Presidency says a number of interim and immediate measures can be implemented while that work proceeds.