President Cyril Ramaphosa has likened Eskom's unbundling to the ending of Telkom's fixed-line monopoly, which allowed private capital to flood into telecoms and fund the deployment of affordable, high-speed fibre networks.
President Cyril Ramaphosa has likened the unbundling of Eskom to the liberalisation of South Africa’s telecommunications industry through the removal of state-enforced monopolies.
In his latest From the desk of The President letter, Ramaphosa said the country has been in a similar position before, when Telkom held a monopoly in the telecommunications industry.
“We have seen before in South Africa how opening a sector to competition and investment can transform an entire industry and make a significant contribution to the economy,” he said.
“There was a time when telecommunications in South Africa was dominated by a single fixed-line operator.”
Ramaphosa explained that, at the time, a telephone service was expensive and access was limited. Millions of South Africans in poorer communities were effectively excluded.
“The opening of the telecommunications sector to new operators fundamentally changed this picture. Competition brought massive new investment. New technologies were introduced,” he said.
“Mobile networks expanded across the country. The cost of communicating fell dramatically, and services that were once available only to a small number of people became accessible to millions.”
Ramaphosa added that, today, South African consumers can choose among different networks and service providers, forcing companies to compete on price, coverage, technology, and quality.
“There is an important lesson in this experience for the transformation of our electricity sector,” Ramaphosa said.
“Electricity is not the same. It is an essential public service with its own particular requirements, and the national electricity grid is a strategic national asset that must remain firmly under public control.”
However, he added that the principle was similar and that South Africans won’t need to choose between a strong Eskom and other competitors.
“We can have both. We can have a strong, state-owned Eskom producing electricity alongside independent producers,” Ramaphosa said.
“We intend to have a state-owned transmission system that provides fair access to the grid, while different generators compete to supply electricity at the lowest possible cost.”
The Presidency recently rebuked Eskom chairman Mteto Nyati for casting aspersions on government’s plan to restructure the power utility.
Nyati had questioned the timing of the planned transfer of Eskom’s transmission assets to the independent Transmission System Operator (TSO).
He repeatedly emphasised that he and Eskom supported a reformed electricity market that promotes competition and access for all participants.
However, he warned against transferring Eskom’s transmission assets too early. Nyati voiced this publicly, prompting a reprimand from The Presidency.
Presidency spokesperson Vincent Magwenya said the government was committed to ensuring that Eskom’s finances did not worsen.
“It is unfortunate that Mr Nyati creates an impression as if there is a process that’s underway without the inclusion of Eskom and at the detriment of Eskom,” Magwenya said.
“All of Eskom’s concerns are well known and have been thoroughly discussed in government and with Eskom.”
Nyati met with Ramaphosa on Thursday, 27 August 2026, to discuss the reform path for South Africa’s energy market.
Ramaphosa emphasised that the TSO would remain state-owned as a strategic national asset serving the public interest.
In response to Nyati’s concerns, the President reiterated the government’s commitment to continue working closely with Eskom and other stakeholders to preserve the utility’s financial position.
He said the implementation must be done in a manner that also ensures the TSO can invest in expanding and strengthening the transmission network.
Moreover, he said it must be done in a way that engages Eskom’s lenders and funders transparently and responsibly.
“The chairperson confirmed the Eskom board’s strong support for the policy direction determined by government and committed to ensuring continued alignment going forward,” the Presidency said.
