The big electricity change tested across 168 SA municipalities
JOHANNESBURG — A new way for large South African businesses to buy renewable electricity has completed its first full year of commercial operation, after Vodacom and Eskom tested the system across more than 15,000 sites spread through 168 municipalities.
The scale is important because Vodacom’s operations presented exactly the problem that has made renewable electricity procurement difficult for businesses with thousands of small sites in different parts of the country. Traditional electricity wheeling is better suited to a direct relationship between a generator and a buyer, while Vodacom’s network includes thousands of low-voltage sites supplied through different municipalities as well as directly by Eskom.
The solution, known as virtual wheeling, allows electricity consumption from those distributed sites to be aggregated and matched against renewable electricity generated by independent power producers.
Instead of requiring a renewable generator to physically supply each Vodacom tower or facility, the electricity continues moving through the national and municipal grid. Consumption and renewable generation are then reconciled through a digital system, allowing the company to account for renewable electricity purchased across its operations.
Vodacom became the first company in South Africa to operationalise commercial virtual wheeling at scale after initially signing an agreement with Eskom in 2023. Two years of technical and regulatory work followed before commercial operation began in September 2025.
The system has now completed a full operational cycle covering 1 September 2025 to 31 August 2026.
Monthly refunds have been processed since November 2025 after Eskom reconciled and confirmed Vodacom’s claims. According to the companies, the process has demonstrated that the system can handle consumption data, validate claims, reconcile electricity purchases and complete financial settlements under real operating conditions.
That makes the development potentially significant beyond Vodacom.
South African companies with operations spread across multiple municipalities have historically faced greater complexity when trying to procure renewable electricity because traditional wheeling arrangements generally connect specific generators with specific customers.
Virtual wheeling is intended to remove part of that restriction by aggregating electricity demand from numerous locations. A retailer with hundreds of stores, a bank with branches around the country or another company operating a large distributed network could potentially use the model rather than requiring separate arrangements for individual locations, although participation would still depend on the applicable electricity market, contractual and regulatory requirements.
Vodacom’s network provides an unusually large test of whether the model can work. The company has more than 15,000 distributed low-voltage sites across 168 licensed municipalities, in addition to sites supplied directly by Eskom.
Vodacom South Africa CEO Sitho Mdlalose said the company approached Eskom with four objectives: reducing complexity, using technology to overcome legacy limitations, creating a commercially viable route to renewable electricity and encouraging greater private-sector participation in addressing South Africa’s electricity problems.
The digital platform supporting the arrangement was developed by Mezzanine, a majority-owned Vodacom subsidiary. It aggregates electricity consumption information from different sites and reconciles it against electricity generated by independent power producers.
Vodacom ultimately wants to source 100% of its electricity demand from renewable sources, making the wheeling mechanism an important part of its own energy strategy. But the wider significance of the first completed year is whether the system can now be replicated by other large electricity users.
Vodacom acknowledged that more work is required to broaden participation and develop the systems supporting virtual wheeling. The first 12 months nevertheless move the model beyond a proposed solution into one that has processed actual claims and settlements across one of South Africa’s most geographically dispersed corporate electricity footprints.
For Eskom and the wider electricity market, the next test will be whether what worked across Vodacom’s 15,000 sites can become accessible to substantially more businesses seeking renewable electricity without having to generate it themselves.
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