Engie, the French energy utility and one of South Africa’s leading renewable power producers, has signalled a strategic pivot from generation into transmission, and potentially further market participation, after being prequalified for the country’s first Independent Transmission Projects (ITP) programme.
The move positions the company to become one of the first private operators of regulated transmission assets in South Africa — a market historically dominated by Eskom.
With more than 15 years’ presence in South Africa, the country is now Engie’s most significant market in the Asia Pacific, Middle East, and Africa (Amea) region, according to Mohamed Hoosen, Engie South Africa CEO and MD for Renewables and Batteries for Amea.
Transmission bottlenecks in provinces with the highest solar and wind potential — such as the Western, Northern, and Eastern Cape — have long constrained renewable energy expansion. Eskom alone has been unable to address these limitations quickly, prompting the government to create the ITP programme.
Engie is one of seven groups the ITP programme has shortlisted to submit bids for multiple transmission projects. While detailed project specifications are yet to be released, Hoosen indicated the initiative could involve seven to 10 transmission lines, ranging from about 70km–80km to several hundred kilometres each. The projects would operate as regulated infrastructure assets, providing long-term, bankable returns to investors.
Comparing private transmission and generation in South Africa, Hoosen said the two represent distinct investment models. Generation projects compete on project-level tariffs and off-take agreements, with returns tied directly to electricity sales. Regulated transmission assets, by contrast, offer predictable, long-term returns on the underlying asset base but require ongoing operational and maintenance investment.
Engie owns and operates about 1,800MW of renewable energy projects under long-term power purchase agreements with Eskom. The company has brought new projects online this year and is pursuing additional developments under the government’s latest independent power producer procurement rounds.
“We want to become a full energy infrastructure player in South Africa,” Hoosen told Business Day. “We’ve already demonstrated our capabilities on the generation side. Now we aim to invest in transmission and eventually participate in the wholesale electricity market. South Africa is one of our most significant markets, and we see real opportunities to expand further.”
Hoosen said the company is actively working to understand how the wholesale market will be structured from a regulatory perspective, particularly the role and independence of the National Transmission Company from Eskom.
“Also, we intend to engage in electricity trading once the market rules are clear and we have a full understanding of the framework. Once we understand the rules of the game we will look to participate in this space,” he said.
The company is operating in South Africa’s evolving energy market, which is moving toward greater competition and an electricity sector where private players can participate beyond generation. Hoosen said Engie’s long-term commitment relies on secure contracts, a dependable buyer for its power and a regulatory environment that supports bankable investments.
“South Africa is evolving toward a more liberalised and competitive electricity market,” he said. “We want to be part of that transition and continue to grow as a dependable partner in the country’s low-carbon future.”
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