Unlocking the potential of wheeling in the Western Cape

The Western Cape has a potential wheeling market of up to 1,600 MW of new renewable energy, representing an investment opportunity of up to R25.6bn. While wheeling allows customers to purchase power from independent power producers (IPPs) via existing grids, its uptake is hindered by limited municipal capacity and the requirement that municipalities be in good financial standing with Eskom. To address these barriers, Eskom is piloting 'virtual wheeling', expected to launch in early 2025, which allows municipal customers to access energy from Eskom-connected IPPs without waiting for municipal readiness. Current wheeling in the province is limited to a few local municipalities, including the City of Cape Town, George, and Swartland. The document highlights that wheeling can provide significant cost savings and price stability for businesses through bilateral power purchase agreements (PPAs), though long-term financial models should account for potential future decreases in daytime energy tariffs.

• The potential market for wheeling in the Western Cape is estimated at up to 1,600 MW of new renewable energy, which equates to an investment opportunity of up to R25.6bn.
• Virtual wheeling is an Eskom pilot program expected to launch in early 2025 that enables municipal and Eskom low-voltage customers to access energy from Eskom-connected IPPs via a virtual account, bypassing the need for municipalities to be fully ready for wheeling.
• Wheeling is currently operational or being explored in four Western Cape local municipalities: the City of Cape Town (Open), George (In operation), and Swartland (Pilot).
• A primary barrier to wheeling is that Eskom only permits wheeling to customers and municipalities in good financial standing, meaning those in arrears are excluded.
• Wheeling provides financial benefits by using an avoided cost mechanism based on the Eskom wholesale energy price (WEPS) excluding losses, allowing customers to achieve savings and price stability through bilateral PPAs.
• The document warns that long-term PPA assumptions of constant price increases may be unrealistic, as an abundance of solar generation could lead to a decrease in daytime energy tariffs.

APA

GreenCape (n.d.). Unlocking the potential of wheeling in the Western Cape. https://greencape.co.za/wp-content/uploads/2025/04/Industry-brief-Unlocking-the-potential-of-wheeling-in-the-Western-Cape.pdf

Chicago

GreenCape. Unlocking the potential of wheeling in the Western Cape. n.d. https://greencape.co.za/wp-content/uploads/2025/04/Industry-brief-Unlocking-the-potential-of-wheeling-in-the-Western-Cape.pdf.

Wikipedia

{{cite report |author=GreenCape |title=Unlocking the potential of wheeling in the Western Cape |url=https://greencape.co.za/wp-content/uploads/2025/04/Industry-brief-Unlocking-the-potential-of-wheeling-in-the-Western-Cape.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{greencapendunlocking, author = {{GreenCape}}, title = {{Unlocking the potential of wheeling in the Western Cape}}, institution = {GreenCape}, url = {https://greencape.co.za/wp-content/uploads/2025/04/Industry-brief-Unlocking-the-potential-of-wheeling-in-the-Western-Cape.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }