So far in 2026, IPPs have accounted for 100% of new generation capacity and looking at the current build pipeline, the private sector demand will have a strong influence on what power projects get built going forward.
A Power Futures Lab briefing note on South African IPPs shows a very large number of IPPs entering commercial operations phase in the first half of 2026.
17 IPP projects reached commercial operations date (COD), adding 1,920MW to the grid. This is South Africa’s largest-ever half-year addition of commercial IPP operational capacity.
Ten of the 17 projects are privately procured to sell to a mine or industrial offtaker, and the other seven fall under the government’s REIPPP and RMIPPP programmes.
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Future generation pipeline looks bright for the private sector
The briefing note suggests that 28 IPP projects (2,202MW) are expected to reach commercial operation in H2 of 2026. This would bring the 2026 capacity additions to roughly 4,123MW, more than double the previous record.
Most of the projects that started commercial operations in 2026 reached financial close in 2024, which was the previous record year for the industry.
Importantly, the briefing note points out that while most of those 2024 financial-close transactions were privately procured, public procurement still comes through strongly in 2026.
“Because 61% of the planned capacity in the 2026 financial-close book is publicly procured, public procurement is set to remain a key contributor to new project builds over the next few years. This reinforces the Q1 2026 finding that REI4P remains decisive, both as a volume driver and as the benchmark for private-market tariffs.”
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The importance of mining and industrial demand as an anchor for newly commissioned projects is unmistakeable. All ten of the privately produced projects that reached COD in the first half of 2026 are contracted for mining or industrial offtakers:
- Anglo American accounts for 38MW (Mooi Plaats and Umsobomvu, through the Envusa Energy joint venture with EDF),
- Sasol and Air Liquide for 330MW (the Impofu wind triplet, developed by Enel), and
- Richards Bay Minerals, ARM Platinum, Exxaro, and PPC for the remaining 336MW.
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Particularly encouraging is that the debt stack is entirely domestically sourced. Every project that reached COD in H1 of 2026 with disclosed financing, raised its debt from South African commercial banks or DFIs. The local capital market is now funding large, 100WM+ projects as a matter of course.
While financial close activity slows markedly after April, the note points out that this “does not necessarily indicate weaker investor appetite”. It bears remembering that some projects take longer than others to clear final commercial and grid-connection steps.
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The remaining pipeline is still substantial:
- REIPPPP Bid Window 7 accounts for 1,520MW,
- Bid Window 6 for 640MW,
- Battery Energy Storage IPPP Bid Window 2 for 462MW, and
- the private-sector pipeline for 621MW.
While wind historically lags solar PV in South African commissioning, it came through strongly this year with wind projects reaching COD across seven projects for 815MW through both public and private procurement.
Storage is also becoming increasingly common as evinced by two renewable energy projects with battery storage components reaching COD under public procurement and the second quarter COD of the Hartebeesfontein BES project representing continuous growth of the storage pipeline.
What comes next?
The timing of the Bid Window 7 projects will largely determine the full-year outcome. On paper, combining H1 commissioned projects (1,920MW) with the 28 further planned in H2 (2,202MW) puts full-year outcome for 2026 on track for 4,123MW across 45 projects.
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When looking at the commissioning pipeline for the second half of the year, it is dominated by mining concerns. Of the 21 projects expected to reach COD in the latter half of the year, the largest are corporate-led:
- Anglo’s Hartebeesthoek (140MW),
- Sasol/Air Liquide’s Umsinde Emoyeni and Khangela (140MW each),
- Mulilo’s De Aar 2 (120MW) and Paarde Valley PV2 (110MW), and
- Seriti’s Ummbila Emoyeni.
Only one IPP reached financial close in the first half of the year – a 77MW/308MWh Hartebeesfontein Battery Energy Storage Project (from Bid Window 2 of the battery auctions), which makes for 9 financial closures confirmed for the first quarter of 2026 in total.
On the planning side, Nersa in a mid-August statement noted that it registered 124 generation facilities in the first quarter of the 2026/7 financial year (total capacity of 804MW).
Of the 124 registered facilities, 63 will connect to municipal distribution networks, at 47MW. The remaining 61 facilities will connect to the Eskom network, accounting for 757MW of planned generation capacity.
