- Concerns are rising that Eskom’s High Court challenge to new electricity trading licences could stall market reform.
- The legal action drew sharp criticism from Minister of Electricity and Energy Kgosientsho Ramokgopa, who publicly urged Eskom to withdraw, or at least pause, the court proceedings.
Concerns are mounting within South Africa’s energy sector that Eskom’s decision to continue with a High Court review application challenging the granting of new electricity trading licences could stall market reform and delay the transition to a more competitive electricity system for years.
The dispute centres on the National Energy Regulator of South Africa’s (NERSA) decision to issue electricity trading licences to five companies in 2024 and 2025.
These licences were widely viewed as a cornerstone of South Africa’s evolving electricity market architecture under the Electricity Regulation Amendment Act of 2024, which seeks to dismantle the country’s long-standing vertically integrated monopoly and introduce greater competition, wheeling, and electricity trading.
Eskom Distribution objected to NERSA’s decision and subsequently launched a High Court review application, citing both technical and legal grounds. Energy expert Chris Yellend said Eskom’s challenge points to alleged procedural and substantive flaws in the regulator’s licensing process.
The legal action drew sharp criticism from Minister of Electricity and Energy Kgosientsho Ramokgopa, who publicly urged Eskom to withdraw, or at least pause, the court proceedings. The minister warned that the case could undermine confidence in the regulatory framework and disrupt NERSA’s accelerated development of electricity trading rules.
When Eskom presented its financial results, chief executive Dan Marokane said the utility had placed the review application on hold, a statement that was initially welcomed by the market. However, subsequent court records revealed that the application had not been formally stayed. A directive issued by the Gauteng High Court in October 2025 confirmed that Eskom has continued to pursue the review.
In response to growing criticism, Eskom said it supports electricity market reform and welcomes new competitors participating in NERSA-led processes. However, the utility acknowledged that it has continued with the legal proceedings.
Eskom said its earlier communication about a stay reflected an intention to allow space for NERSA to conduct consultations and public hearings on new trading rules, rather than a formal legal suspension of the case.
Eskom argued that it could not abandon the application outright without compromising its legal position, particularly after NOA Group Trading declined a request to stay the matter and proceeded with court processes.
According to Marokane, Eskom’s concerns remain unchanged, warning that the introduction of new traders under current rules could allow subsidy-contributing customers to avoid paying billions of rands in cross-subsidies.
Yellend, however, questioned Eskom’s explanation, noting that ongoing litigation is already preventing new traders from securing bank financing, entering contracts with generators, and selling power to offtakers. He warned that prolonged court action, combined with slow judicial processes, could delay South Africa’s electricity market reform agenda for years, eroding institutional trust and investor confidence.