SA Govt Advances ITP Programme to Attract Grid Investment, Aligns with CGV

South Africa's government has reaffirmed its commitment to the Independent Transmission Projects (ITP) Programme, a flagship initiative intended to unlock large-scale private investment in the country's aging and overburdened electricity transmission infrastructure. This effort, jointly driven by the Department of Electricity and the National Treasury, is being hailed as a cornerstone of South Africa's broader energy reform agenda.

ITP Programme: Unlocking Private Capital for Transmission Infrastructure

The ITP Programme aims to modernise and expand South Africa's national grid, which has long been a bottleneck in the country's energy system, particularly as the country pivots toward integrating more renewable energy into the power mix. The initiative seeks to facilitate private sector participation in building and operating transmission infrastructure, historically dominated by state-owned utility Eskom.

According to a joint statement from the departments, the ITP Programme "remains on track" and will continue to be guided by principles of bankability, transparency, and credibility—factors deemed essential for attracting long-term infrastructure investment.

This is the first programme of its kind in the country, combining grid development with private sector finance in a bankable procurement structure. It aligns with global trends in power sector liberalisation and infrastructure modernisation.

Linking the ITP with the Credit Guarantee Vehicle (CGV)

A critical development in the ITP's implementation is its alignment with the Credit Guarantee Vehicle (CGV), a new financing mechanism developed by National Treasury with support from the World Bank Group.

The CGV will function as a private, non-life insurance entity, regulated by South Africa's Prudential Authority, and will issue credit guarantees to infrastructure investors. It represents a significant innovation in the country's infrastructure finance landscape, intended to mobilise private capital while reducing reliance on sovereign guarantees.

The sequencing of ITP procurement phases and the operational readiness of the CGV is now being synchronised to boost investor confidence and ensure bidders have full clarity on the guarantee structures available at the time of bid submission and financial close.

Timelines for Procurement and Consultations

The government has updated the timeline for ITP Phase I to enhance alignment with the CGV establishment and market expectations:

• Pre-qualified bidders (PQBs) are set to be announced by 15 December 2025.

• A draft Request for Proposals (RFP) will be issued shortly thereafter to allow PQBs to provide feedback on commercial and financial terms.

• The final RFP is expected to be published by Q3 of the 2026 calendar year.

This phased and consultative approach is designed to allow thorough market feedback, enabling early identification of technical and commercial challenges and reducing the need for clarifications after the RFP is released.

The government aims to create a fit-for-purpose RFP that reflects market realities and lender expectations. It is also intended to attract competitive, high-quality bids that facilitate timely financial close and uphold the credibility of South Africa's energy procurement regime.

Why This Matters for Energy Reform and Economic Renewal

The ITP Programme is more than just a procurement process—it is a catalyst for economic transformation. With its emphasis on transparency, localisation, and collaboration, the programme is expected to:

• Strengthen South Africa's transmission infrastructure.

• Support the integration of renewable energy into the grid.

• Mobilise billions in private investment.

• Reduce pressure on Eskom by decentralising transmission infrastructure development.

• Spur job creation, skills development, and local economic participation.

Furthermore, the CGV is set to provide an institutional innovation that will deepen financial markets and offer a replicable model for future infrastructure investment beyond electricity.

Laying the Groundwork for a Modern Energy System

While the revised timeline adds a few months to the original schedule, the government asserts that these refinements are necessary to protect the integrity of both the ITP and CGV processes. The coordinated effort between the Department of Electricity and National Treasury reflects a deliberate and robust strategy to create a credible and internationally benchmarked framework for grid investment.

As South Africa continues its journey toward energy security and economic revitalisation, the ITP and CGV together signal a bold shift toward market-based, yet inclusive infrastructure development.