MASEDI TLHONG: The national grid’s autonomy is a matter of governance, not ownership

I have argued in the past that the independence of the National Transmission Company of South Africa (NTCSA) is non-negotiable for a functional energy market (“Conflict of interest at the heart of open electricity market”, November 14 2025). Since then, the national conversation has often defaulted to a tired binary — that “independence” is merely a polite euphemism for privatisation.

That is a fundamental misunderstanding of institutional design. The transmission company does not need a change in equity to promote competition and provide a neutral platform for state and private generators — it needs a revolution in governance. Independence is a design feature of effective institutional architecture, regardless of who holds the shares.

Ownership-efficiency fallacy

The push to equate independence with privatisation is often fuelled by a racialised narrative that has haunted South African discourse for decades. In this view, “efficiency” is coded as private and “white”, while “inefficiency” is coded as public and “black”.

That narrative is not only socially divisive but also intellectually lazy. It suggests the state is inherently incapable of professional excellence. Yet a look at our broader institutional landscape reveals more than 50 state-owned entities (SOEs) that are functioning well, financially stable and delivering on their mandates.

Independence as a technical requirement

For a transmission company, “independence” means one thing: neutrality. The grid is the “referee” of the energy market. If the referee is owned by the state but managed by a board that is legally and operationally shielded, the market can flourish.

We see this in models such as Norway’s Statnett or Singapore’s SP Group. They are 100% state-owned utilities that are world leaders in reliability and efficiency. They succeed because they use an independent system operator (ISO) framework.

In that model the state remains the custodian of the “poles and wires”, but the rules of the game — who gets to plug in, at what cost, and when — are managed by a board protected by “fortress governance”.

Building the governance fortress

To ensure the transmission company achieves that without being privatised we must implement the following governance safeguards:

• Statutory insulation — the board appointment process must be transparent and involve various stakeholders. If a single minister has the sole power to hire and fire, the entity is a department not an independent company.
• Staggered board tenures — to prevent “political purging”, board terms should not align with the five-year electoral cycle to ensure continuity of technical expertise across different administrations.
• Revenue ring-fencing — the transmission company’s balance sheet must be legally “walled off”. Its profits should be reinvested into the grid, not siphoned off to bail out other failing sectors.

Quiet successes

Air Traffic and Navigation Services manages about 10% of global airspace with a world-class safety record, and operates free from political interference. The Industrial Development Corporation remains financially self-sustaining while funding high-risk industrial projects that drive national growth.

The Council for Scientific & Industrial Research leads multi-disciplined global research and technology through state-funded mandates. The South African Special Risks Insurance Association provides essential, specialised insurance services that remain financially robust and operationally distinct.

Those entities succeed because they have established clear, statutory boundaries between the ministry (shareholder) and the board (operations).

We must stop conflating the transfer of assets with the transformation of governance. The transmission company must be independent so that it can act as the neutral backbone of a competitive power sector. However, we must reject the idea that we have to sell the grid to save it.

By focusing on institutional integrity and adopting proven global governance frameworks, we can ensure the transmission company remains a public asset that operates with private sector discipline. Independence is a matter of law, board composition and technical mandate — not a share certificate.

• Tlhong is director: corporate commercial at TGR Attorneys Inc.