Independent power producers under South Africa’s REIPPPP face sharply higher curtailment by Eskom in 2026, with volumes roughly ten times those of 2025. Revenues at some projects are running 9% below budget amid reimbursement delays. The backlog of owed payments is approaching R1 billion.
Curtailment occurs when Eskom’s System Operator instructs producers to reduce output despite contractual entitlements to payment under take-or-pay agreements. Claims must be filed within 48 hours and include estimates based on wind and solar data. Reimbursement reviews, once completed in three to four months, now extend up to a year.
Industry sources attribute the rise to generation overcapacity, weakening demand from energy-intensive users, and network constraints. Later bid-window projects operate on thinner margins, leaving them more exposed to lost revenue and delayed cash flows.
Eskom serves simultaneously as system operator, payment counterparty, and dominant generator through its own renewable plans. Independent power producers question the transparency of merit-order decisions and suspect uneven application of rules. They call for oversight by the National Energy Regulator of South Africa and an independent transmission operator to ensure fairness.
