The Electricity Regulation Amendment Bill, passed by Parliament in May 2024, provides for the establishment of a wholesale electricity market in South Africa.
Much work has been undertaken on the proposed market design – in April 2024 Eskom and the the NECOM (National Electricity Crisis Committee) in the Presidency. launched the draft market code and South African wholesale market specification
The draft market code serves as a set of rules and guidelines that govern the operation and conduct of market participants. The draft code aims to enable competition within the electricity supply industry by establishing platforms that will facilitate the trade of electricity.
It has been proposed that these will include:
Short-term physical energy markets such as the i) day-ahead market and ii) intraday market
A balancing market to ensure the difference between real and predicted supply and demand are reconciled
An ancillary and other services market to provide network support services
A capacity market or remuneration scheme - which may consist of contracts to provide capacity for longer-term supply security
Longer-term bilateral trades (both physical and financial) energy to be traded directly between a buyer and seller outside the short-term physical markets to allow for hedging against price risk.1
It is envisaged that these platforms will make up the future hybrid multi-market model.
The National Transmission Company of South Africa (NTCSA) which officially commenced trading in July 2024 as a distinct and wholly owned subsidiary of Eskom, has developed an internal market with a price history based on market rules.
The NTCSA has also purchased energy from the private sector under two procurement programmes – the standard offer programme and the emergency generator programme.2The latter involves soliciting bids from private-sector generators.
Moderators: Kay Walsh, SAAEE President
Speakers: Keith Bowen, Senior Manager, Energy Market Services, NTCSA
Other Roles: Discussant: Ryan Hawthorne, SAAEE Council Member
In this webinar, SAAEE will be inviting Keith Bowen, a Senior Manager in the Energy Market Services Division of the NTCSA to explain how the proposed wholesale electricity market will function. He will also highlight some of the prerequisites for the successful launch of the wholesale market and some of the issues raised in a series of consultation workshops on the draft code that has been hosted by NECOM.
1 See: https://www.eskom.co.za/eskom-divisions/tx/energy-market-services/market-operator/short-term-ennergy-purchase-programme/
2 See: https://www.eskom.co.za/wp-content/uploads/2024/04/South_African_Market_Specification_v1.0.pdf