<\/p>\n
South Africa can largely avoid renewed electricity shortages over the next decade \u2013 provided Eskom sustains its generation recovery, replacement capacity arrives on schedule and the transmission grid expands as planned.<\/p>\n
That is the qualified message of the National Transmission Company South Africa\u2019s (NTCSA) Medium-Term System Adequacy Outlook (MTSAO) 2027\u20132036, published on 30 October 2026. But the report arrived just two days after government announced that its first gas-to-power procurement round had failed.<\/p>\n
Read\/listen:
11 years, thousands of megawatts, zero delivery \u2026
Government unveils new electricity procurement plan<\/p>\n
This begs the question at the heart of an otherwise encouraging assessment: how secure is the MTSAO Reference Case when one of its most consequential assumptions is already in doubt?<\/p>\n
An optimistic outlook \u2013 with important qualifications<\/p>\n
The NTCSA\u2019s Reference Case assumes high electricity demand growth, improving Eskom plant performance, substantial new renewable energy and storage, major transmission upgrades and new gas-fired generation from 2032.<\/p>\n
Importantly, this is not a low-demand forecast to provide reassurance of system adequacy. Under the High Demand trajectory, annual sent-out electricity increases to 329.7 TWh and peak demand to 49.1 GW by 2036, compared with 238.3 TWh and 35.8 GW in 2026.<\/p>\n
The demand projection increases the importance of delivering new generation to replace aging generation due for retirement.<\/p>\n
This is not the same as a system free of supply risk. By 2036, the Reference Case still records 13.42\u00a0GWh and 377 hours of unserved energy \u2013 hours in which some demand cannot be met, not a forecast of nationwide load shedding. The study\u2019s hourly, network-constrained simulations are a significant modelling advance, but the results are conditional outcomes that are not stated with any degree of certainty.<\/p>\n
Coal retirements put Eskom\u2019s EAF under the spotlight\u00a0<\/p>\n
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The MTSAO Reference Case assumes Eskom\u2019s energy availability factor (EAF) rises from 66% in financial year 2027 to 70% by 2031, remaining there through to 2036. The downside trajectory holds EAF at 65%. This five-percentage-point difference is critical when the existing Eskom fleet is being reduced.<\/p>\n
The MTSAO report assumes approximately 16.2 GW of Eskom capacity is shut down by 2036, including 8.75 GW in 2029 and 2030. Coal stations dominate the retirements, although two diesel peaking plants are also included.<\/p>\n
Contracts for 1150 MW from Cahora Bassa and 1005 MW from the Avon and Dedisa peakers are assumed to expire in 2030. A further approximately 3 GW of existing renewable projects reach the end of their assumed operating or contractual period between 2033 and 2036.<\/p>\n
Eskom\u2019s recent improvement is noted: the report records EAF recovering from 56% in financial year 2023 to 66% in 2026. However, maintaining 70% on a shrinking, ageing fleet is not assured.<\/p>\n
Nor should the percentage EAF obscure the fleet MW capacity on which the percentage EAF is based: a higher EAF applied to a smaller fleet does not necessarily yield more available megawatts. The timing of coal shutdowns, life extensions and replacement projects need careful scrutiny.<\/p>\n
The missing gas \u2013 procurement ambition meets reality\u00a0<\/p>\n
New gas is another major pillar of the MTSAO Reference Case. None is assumed before 2032, when 3 GW of Eskom capacity and 2 GW of independent power producer (IPP) capacity could enter service. Gas capacity rises to 3 GW in 2033, while later Integrated Resource Plan (IRP) 2025 additions take total new gas capacity to 9.75 GW by 2036.<\/p>\n
Yet on 28 October the Department of Electricity and Energy confirmed that Gas IPP Procurement Programme Bid Window 1 had produced no preferred bidders.<\/p>\n
Four bids totaling 2830 MW had been submitted for 2000 MW sought, but none met mandatory requirements, chiefly because satisfactory assurances of gas supply were unavailable.<\/p>\n
This was not simply a failure to attract investors. South Africa lacks an operational liquefied natural gas import terminal, and the fuel-supply challenge applies beyond the failed IPP bids to the broader gas build programme to meet industrial gas demand. The ministerial determination on 7 October 2026 for 5000 MW of gas-to-power establishes procurement authority, not a gas source, port terminal, bankable project or commissioning date.<\/p>\n
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Significantly, the MTSAO acknowledges that these October 2026 developments were not incorporated into its June 2026 model inputs. The final chapter on the MTSAO 2027-2036 report warns that gas delivery risk has increased and that the Reference Case outcomes from 2032 should be treated with greater caution.<\/p>\n
What the Perfect Storm does \u2013 and does not \u2013 show<\/p>\n
The MTSAO Perfect Storm scenario combines high electricity demand, 65% EAF, no new gas generation and slower uptake of small-scale embedded generation. In this scenario, conditions deteriorate sharply from 2033. By 2036, annual unserved energy exceeds 900 GWh \u2013 more than 45 times the 20 GWh adequacy criterion \u2013 while the average magnitude of severe shortfalls, exceeds 2000 MW and diesel peaking plant utilisation breaches the 6% criterion.<\/p>\n
These are serious warning signals. They are not, however, a standalone measurement of the cost of losing gas. Four adverse assumptions must change together. The study does not show what happens if gas is delayed but Eskom achieves 70% EAF, or if gas arrives while EAF remains at 65%.<\/p>\n
This distinction is important. The Perfect Storm scenario illustrates the combined downside vulnerability; it does establish that the full 9.75 GW gas programme is indispensable, or that failure to deliver it would, by itself, recreate a national electricity crisis.<\/p>\n
Could faster renewables and storage close the gap?<\/p>\n
The MTSAO Accelerated Build scenario provides a useful contrast. Lower demand, higher EAF, more rapid generation development and greater uptake of embedded generation, largely eliminates adequacy shortfalls. But this scenario includes new gas capacity; so it is not a test of a renewables-and-storage system without gas.<\/p>\n
The MTSAO Reference Portfolio itself already envisages 17.7 GW of solar PV and 22.1 GW of wind by 2036, alongside batteries and embedded generation. The broader potential renewables build pipeline is larger. A central question is whether bringing forward credible wind, solar, storage, flexible demand and grid projects could offset some or all of the consequences of delayed gas procurement.<\/p>\n
Grid delivery is a further dependency. The MTSAO incorporates approximately 14,508 km of additional transmission lines and 144 GVA of new transformer capacity. Delays would impede renewable energy evacuation and could cause local shortages despite sufficient national generating capacity.<\/p>\n
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There are constraints. The MTSAO Accelerated Build scenario produces more than 43 TWh of excess energy in some years, reflecting mismatches between output, demand and network capability. This is not an argument to stop renewable development. But it demonstrates the need to coordinate new generation with storage, more flexible conventional operation, demand shifting and transmission expansion.<\/p>\n
The study\u2019s Reduced Storage test reinforces the point. By 2036, limiting battery deployment to 1744\u00a0MW raises excess energy from 3.54 TWh to 6.37 TWh, and unserved energy from 13.42 GWh to 28.08 GWh. Batteries therefore improve renewable integration and contribute to adequacy.<\/p>\n
The modelling South Africa now needs<\/p>\n
The NTCSA deserves credit for openly acknowledging these limitations. Indeed, the report proposes the next tests needed: modelling of an Accelerated Build scenario without new gas, under both low and high demand, to establish whether a larger renewable and storage portfolio can maintain adequacy \u2013 including during evening peaks and prolonged periods of low wind and solar power.<\/p>\n
These should be accompanied by cases retaining the upper EAF trajectory but delaying gas, and by sensitivity tests for coal closure timing, storage duration, gas fuel availability, transmission delivery and demand response. Their results should then be assessed against capital costs, operating costs, emissions and realistic project lead times. Adequacy alone cannot identify the least-cost or least-risk technology mix.<\/p>\n
The report\u2019s real message is not that gas is inevitably required at the assumed scale, nor that renewables and batteries can replace it without qualification. It is that South Africa faces a tightly linked set of delivery risks as coal and other capacity retires.<\/p>\n
Before gas assumptions harden into investment commitments, the system operator and policymakers should demonstrate \u2013 transparently and with comparable scenarios \u2013 which combinations of generation, storage and flexibility can keep the lights on if the gas does not arrive.<\/p>\n
\u00a9 Copyright 2026 \u2013 EE Business Intelligence (Pty) Ltd. All rights reserved.\u00a0<\/p>\n
#Fragile #assumptions #South #Africas #optimistic #electricity #outlook<\/p>\n","protected":false},"excerpt":{"rendered":"
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