JOHANNESBURG – Norwegian energy firm Scatec is expanding its footprint in South Africa’s private electricity market, marking a significant step in the country’s evolving energy landscape. The company’s recent moves signal a broader trend of private sector involvement in South Africa’s power generation, driven by the need to address chronic electricity shortages and diversify energy sources. This expansion into direct electricity contracts with private businesses complements Scatec’s existing projects within South Africa’s public programs.
Scatec recently announced an agreement to operate in the “wheeling” segment, facilitating the delivery of electricity generated from its plants to private companies. This development, first reported by Agence Ecofin, comes as South Africa actively seeks to liberalize its energy market and encourage private investment in renewable energy. The company is currently constructing the Thakadu power plant, which will be built in two phases, further solidifying its commitment to the region.
Grootfontein Solar Complex: A Milestone in Renewable Energy
This expansion builds on Scatec’s existing investments in South Africa, most notably the recently commissioned Grootfontein solar complex. The 273-megawatt (MW) facility, representing an investment of 5.1 billion South African rand (approximately 257 million euros), began commercial operation in December 2025. The complex is expected to generate 700 gigawatt-hours (GWh) of green electricity annually, avoiding the emission of around 630,000 tonnes of CO₂ each year, according to Agence Ecofin.
Scatec holds a 51% stake in the project and is responsible for its operation, maintenance, and asset management. The Grootfontein complex, the largest photovoltaic plant in the Western Cape province, will supply electricity under a 20-year power purchase agreement with Eskom, South Africa’s state-owned electricity utility. The project falls under the fifth cycle of the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP), a government initiative designed to attract private investment in renewable energy.
The REIPPPP and South Africa’s Energy Transition
Launched in 2011, the REIPPPP program has been instrumental in opening up South Africa’s energy sector to independent power producers. By offering 20-year power purchase agreements guaranteed by the state, the program reduces financial risk and encourages both local and international investment. Scatec has been a significant beneficiary of this program, establishing itself as a key player in the South African solar energy market since its arrival in the country in 2010.
“This project is based on our commitment to provide clean and reliable energy while creating sustainable value for local communities and our partners,” said Terje Pilskog, CEO of Scatec, in a statement. “We thank our stakeholders for their continued collaboration and look forward to continuing our support for the energy transition in South Africa.”
Addressing South Africa’s Energy Crisis
South Africa has been grappling with an ongoing energy crisis, characterized by frequent power outages, known as “load shedding,” which have severely impacted businesses, and households. Eskom, burdened by aging infrastructure, debt, and operational challenges, has struggled to meet the country’s electricity demand. The government’s push to attract private investment in renewable energy is seen as a crucial step towards addressing this crisis and ensuring a more secure and sustainable energy future.
Scatec’s expansion into the private electricity market represents a significant development in this regard. By offering direct electricity contracts to businesses, the company provides an alternative to Eskom and helps to alleviate the strain on the national grid. This move also demonstrates the growing confidence of international investors in South Africa’s renewable energy sector.
Looking Ahead: Scatec’s Continued Investment
Scatec’s commitment to South Africa extends beyond the Grootfontein and Thakadu projects. The company is actively exploring further opportunities to expand its renewable energy portfolio in the country, including wind and hydropower projects. The company’s long-term strategy is aligned with South Africa’s national energy plan, which aims to increase the share of renewable energy in the country’s energy mix.
The company’s continued investment is expected to create jobs, stimulate economic growth, and contribute to South Africa’s efforts to reduce its carbon emissions. As South Africa continues to navigate its energy transition, Scatec is poised to play a key role in shaping a more sustainable and resilient energy future. The next major milestone for Scatec in South Africa will be the completion of the first phase of the Thakadu power plant, with a projected operational date in late 2026 or early 2027.
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