KGANKI MATABANE | This grid project must transmit economic power to all South Africans

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ExpandSilhouette High voltage electric towers at sunset time. High-voltage power lines. Electricity distribution station. Picture: ESOlex South Africa stands on the threshold of one of the largest infrastructure investments in its democratic history. Over the next decade, about 14,500km of new transmission lines will be built to expand the national grid and support economic growth.

This is not merely an energy project. It is a nation-building project. It is an industrialisation project. It is a transformation project. The question is simple: will this investment change the structure of the South African economy, or will it merely reinforce the status quo?

If history is our guide, there is reason for concern. When South Africa launched the independent power producer (IPP) programme through bid window 1 and subsequent rounds, the country had a unique opportunity to build a transformed and inclusive energy sector. The programme attracted investment and added generation capacity. But it failed in three critical areas: transformation, localisation and industrialisation.

The energy sector today remains dominated by the same established players. Ownership patterns remain largely unchanged. There is not a single major black-owned energy company that can claim meaningful participation at scale in the sector.

Black businesses remain on the margins of the energy economy. Black women, young entrepreneurs, and persons with disabilities continue to face significant barriers to entry. Even more concerning is that many of the dominant players in our energy market are foreign-owned entities and global energy giants, many of them the equivalent of Eskom in their own countries.

These companies have entered the South African market, won substantial opportunities, and generated significant returns. Yet the promised transformation of ownership and industrial capability has simply not materialised. We must have the courage to acknowledge this reality.

South Africa missed a historic opportunity to use the IPP programme as a lever to create black industrialists, develop local manufacturing capacity and establish a globally competitive domestic energy industry. Too much value was exported. Too many opportunities for local production were lost. Too many South Africans remained spectators in an economy built with South African demand and South African public infrastructure.

We cannot afford to repeat this mistake. The procurement of 14,500km of transmission infrastructure is arguably the biggest strategic procurement programme in South Africa in more than 50 years. The economic implications extend far beyond electricity. This procurement will influence manufacturing, steel production, engineering services, construction, logistics, technology development and skills creation.

The Black Business Council believes that this programme must be designed deliberately to transform ownership patterns, localise production and industrialise the economy. This cannot be left to chance. It cannot be left to market forces. It cannot be left to procurement processes that focus solely on price while ignoring broader economic outcomes.

The notion that transformation will somehow happen organically has been disproven repeatedly. Markets do not correct centuries of exclusion. Markets do not automatically create black industrialists. Markets do not voluntarily dismantle entrenched patterns of ownership and control. Transformation requires intentional intervention.

The government, Eskom and all relevant authorities must establish binding localisation, industrialisation and transformation targets before a single contract is awarded. Every kilometre of transmission line must contribute to building local industries. Every transformer, tower, cable and component must be assessed for local manufacturing opportunities. Every contract must create opportunities for black-owned businesses throughout the value chain.

The objective must be clear and measurable.

The government, Eskom and all relevant authorities must establish binding localisation, industrialisation and transformation targets before a single contract is awarded

We should be pursuing majority local content wherever practical. We should be creating thousands of sustainable jobs. We should be building manufacturing facilities that will continue producing long after this project is complete. We should be developing local engineering expertise that can compete internationally.

Most importantly, we should be creating a generation of black-owned companies capable of becoming major players in the energy sector. South Africa does not need perpetual subcontractors. South Africa needs owners. South Africa needs manufacturers. South Africa needs black industrial champions.

The current procurement framework and legislation already provide sufficient scope to pursue these objectives. This is not a question of changing the law. It is a question of political will, implementation and leadership.

Global companies that wish to participate in this programme must understand that access to the South African market comes with responsibilities. The days of superficial partnerships and box-ticking exercises must come to an end. Meaningful participation should require genuine equity partnerships with local black-owned firms, technology transfer agreements, skills development commitments and local manufacturing investment. International firms should not simply arrive, win contracts, import equipment and repatriate profits. They must contribute to the long-term development of the South African economy.

If they benefit from our market, they must invest in our people. If they benefit from our infrastructure programme, they must help build our industries. If they benefit from South African opportunities, they must contribute to South African transformation.

This is neither unreasonable nor radical. It is precisely how successful economies around the world have built domestic industrial capacity. Countries that have industrialised did not do so by outsourcing opportunity. They did so by leveraging public procurement to develop local industries, local skills and local ownership.

South Africa must do the same. The rewards could be enormous. A properly structured transmission rollout can create tens of thousands of jobs across multiple sectors. It can stimulate manufacturing activity, strengthen supply chains and attract new investment into productive industries. It can expand the tax base and reduce unemployment. It can help unlock economic growth through increased industrial activity and infrastructure-led development.

But these outcomes are not guaranteed. They will only happen if transformation, localisation and industrialisation are treated as core objectives rather than secondary considerations.

This moment demands bold leadership. Future generations will not judge us by how many kilometres of transmission lines we built. They will judge us by whether those transmission lines changed the lives of South Africans. They will judge us by whether they created jobs, built industries and transformed ownership. They will judge us by whether black people, black women, young people and persons with disabilities became genuine participants in the economy rather than perpetual observers.

South Africa has already lost one opportunity through the IPP programme. We cannot afford to lose another. The procurement of transmission infrastructure must become the vehicle through which we fundamentally reshape the energy sector, transform ownership patterns and build an industrial economy that works for all South Africans.

This is not the time for hesitation. This is not the time for business as usual. This is the time for decisive action, bold targets and uncompromising implementation. The transmission build programme must not simply power South Africa’s future. It must transform it.

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