Reforms in the energy sector are likely to be “pushed out slightly” amid Eskom’s “complex” restructuring, said Rudi Dicks, head of the project management office in the Presidency, on Friday.
The government was slightly off track on electricity distribution and clearing the title deeds backlog, he said.
As part of energy reform, the government is separating Eskom into generation, transmission and distribution companies, bringing in private sector participation in generation, and creating a wholesale market to improve power supply and cut costs.
During the quarterly update of Operation Vulindlela phase II at the JSE on Friday, Dicks flagged Eskom restructuring as one of the risks in the government’s infrastructure reform programme, describing South Africa as a “laggard”.
“These things are complex. We have to get stuff right from a regulatory point of view. The reforms in the electricity sector are likely to be pushed out slightly because we have got to follow particular processes, and I think it is important that the commitment remains that we continue with the restructuring of the electricity sector and Eskom being at the centre,” he said.
The reforms under Operation Vulindlela have focused on:
- restructuring the energy industry and Transnet;
- easing the visa application and immigration process to bolster tourism;
- reforming water and sanitation; while
- helping with the strengthening of local government.
We said that having one company providing electricity is not good for South Africa; we have a lived experience out of that. We said we need to reform the electricity industry in order to allow the private sector to generate electricity
— David Masondo, deputy finance minister
Operation Vulindlela is a joint initiative of the Presidency and the Treasury to fast-track progress with economic reforms.
Also reporting on the progress of the third quarter of 2025/26 under Operation Vulindlela phase 2, deputy finance minister David Masondo said on Friday that the reforms had made an impact on stable energy supply and energy generation.
“We have not had load-shedding, and it is a consequence of these reforms. We said that having one company providing electricity is not good for South Africa; we have a lived experience out of that. We said we need to reform the electricity industry in order to allow the private sector to generate electricity,” he said.
While Eskom’s restructuring had been slow, the introduction of distribution agency agreements was a critical component of reform.
“The government’s focus will now be on releasing the EDI Roadmap to enable implementation of key reform proposals,” he said.
Among the milestones during the period was the National Energy Regulator of South Africa’s (Nersa) approval of a market operator licence for the National Transmission Company of South Africa (NTCSA) in November.
There was progress with electricity reforms, Masondo said, pointing out that under the electricity act before, private entities and individuals could only generate 1MW of power.
“We have changed the act. As a result, a number of households and companies are generating their own power without legislative constraints. It is our view that has also reduced the demand on energy on Eskom because many people are able to generate energy, and therefore the demand on Eskom has reduced,” he said.
It is important because tourism already sustains close to 2-million jobs in South Africa, but we know that for every 13 new arrivals, we create one sustainable job. These visa reforms are making South Africa a much more attractive destination for tourism,
— Masondo
Masondo expects a number of jobs to be created as the private sector invests in power generation.
South Africa needs 14,000km of transmission infrastructure to transmit power generated in the Northern Cape, Eastern Cape and Western Cape into the grid, which requires about R500bn of transmission infrastructure. The involvement of the private sector will make an impact, he said.
In terms of logistics, the revised network statement, which will include updated access tariffs, is to be published in February.
To beef up port infrastructure, in December Transnet signed a 25-year concession agreement with the Philippines’ International Container Terminal Services Inc (ICTSI) for the upgrade and operation of Durban Container Terminal Pier 2, South Africa’s biggest container terminal.
In terms of visa and immigration, the Electronic Travel Authorisation (ETA) system was rolled out to priority markets, enabling digital visa processing. The ETA system enables biometric capture and online applications aimed at replacing paper-based systems and visa applications.
Also speaking at the event, Saul Musker, director of strategy and delivery support in the private office of the president, said South Africa welcomed a record number of tourists in 2025.
“It is important because tourism already sustains close to 2-million jobs in South Africa, but we know that for every 13 new arrivals, we create one sustainable job. These visa reforms are making South Africa a much more attractive destination for tourism,” he said.
South Africa welcomed a record 10.48-million international arrivals in 2025, a 17.6% increase compared to a year earlier and underscoring how tourism remains a key driver of economic growth and job creation.
Despite geopolitical uncertainty, South Africa’s prospects were positive going into 2026 after its removal from the Financial Action Task Force grey list, the credit ratings upgrade by global credit ratings agency S&P and the stronger currency.
Masondo said in the context of the low economic growth environment, moving with speed is vital even in the government of national unity (GNU).
Business Times
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