Guide to financing municipal energy transitions in South Africa

Municipalities in South Africa are operating within an electricity system that is undergoing a major transition. This transition has serious implications for how municipal electricity infrastructure is financed. As electricity markets evolve, municipal revenue models are changing, particularly as electricity sales become less predictable and new supply arrangements emerge. These shifts affect municipalities’ ability to enter into long-term agreements, structure bankable projects, and attract private investment.

This guide is designed to support municipalities in navigating the transition. It brings together key elements of the evolving electricity sector, including regulatory reform, market developments, institutional roles, and financing considerations. It explains how these shape the development of municipal electricity projects that are capable of accessing finance. With this guide, we aim to contribute to the larger national project of equipping municipalities to steer place-based, local just energy transitions.