Eskom Wins Approval for Wholly Owned Green Arm Targeting 32 GW by 2040

Eskom, South Africa's state power utility, received approval on Thursday July 16 for Eskom Green, a wholly owned renewables subsidiary cleared to raise funding for large-scale renewable energy projects. The structure targets up to 32 GW of renewable capacity by 2040.

The clearance came under the Public Finance Management Act (PFMA), which allows the unit to exist formally as an entity held 100% by the group. Eskom Green was created in June and is mandated to develop, finance and operate large-scale renewable generation plants.

The utility describes the step as an important milestone in its unbundling strategy and expects it to attract private investment through public-private partnerships. That is the mechanism worth reading closely: the ring-fenced balance sheet, not new generation assets, is what changes here. The subsidiary is intended to support South Africa's energy transition, strengthen energy security and help large electricity users cut their carbon emissions.

The near-term pipeline is more modest than the headline figure. Eskom has designed 17 priority renewables and storage projects on the footprint of its coal stations, with a combined target of 6 GW by 2030. The longer-dated pipeline runs to as much as 32 GW of renewable and storage capacity by 2040.

One of those coal-site projects is already committed. In May, Eskom announced a 75 MW photovoltaic plant at the Lethabo coal station in Free State province, costing ZAR 1.2 billion, or about EUR 64.1 million according to La Tribune Afrique. Once operational, the installation is expected to produce around 147 GWh of green electricity per year, enough to supply close to 60,000 South African households.

For comparison, the country's entire installed renewables base stood at 16.5 GW in 2025, the largest on the African continent, according to the International Renewable Energy Agency (IRENA). The 32 GW ambition is therefore roughly double the existing fleet, on a horizon that gives Eskom Green a decade and a half to close the gap.

Private developers are already contracted through the state's Renewable Energy Independent Power Producer Procurement Programme (REIPPPP), launched in 2011. Developer Mulilo announced in March an investment programme of about EUR 801 million, or ZAR 5 billion, to speed up deployment of solar, wind and storage plants. That envelope funds three large photovoltaic plants and a battery energy storage system (BESS), adding 716 MW to the national grid.

That sets the competitive frame Eskom Green enters. Independent producers have had a procurement route into the national grid since REIPPPP began, and single private financing rounds are now sized in the hundreds of megawatts. Eskom's new vehicle competes for the same equity and debt pools, with the advantage of coal-site land, grid connections and an existing customer base, and the constraint of a state parent whose funding capacity is precisely what the unbundling is meant to work around.

The read for international capital is structural. A state coal generator carving out a legally separate, fully owned subsidiary to carry renewables debt is a financing template rather than a technology bet: the assets are conventional solar, wind and batteries, while the innovation sits in the corporate perimeter and the partnership terms.

Eskom Green's launch was reported by Rosestad 100.6FM, a Bloemfontein community radio station, in a piece compiled by Ilde Roos and published July 16. The photograph accompanying the launch is credited to Energy News Africa.