81272859-Strategic Consultation on the Future Direction of Eskom Generation

In 2021, at the State of the Nation Address (SONA), the President of South Africa has reconfirmed that the vertically integrated state-owned utility Eskom will be separated into three state-owned entities: generation, transmission and distribution. This will lay the foundation for an efficient, modern and competitive energy system that will enable greater private sector participation and investment in generation capacity to address South Africa's ongoing power crisis. ‘The Roadmap for Eskom in a Reformed Electricity Supply Industry’, published by the Department of Public Enterprises, outlines a structural reform, where an independent transmission system and market operator (ITSMO) can procure electricity from a diversified, competitive generation sector on economic grounds and at least cost. However, a detailed implementation and transition strategy, that also looks at future mandates, roles and business models as well as risks and other future opportunities for the respective Eskom divisions is still to be finalised. It is the responsibility of the divisions to define their position and revenue streams in the future South African Electricity Sector. Against this backgorund, the South African-German Energy Program (SAGEN), funded by the German government and implemented by the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH in collaboration with the Department of Mineral Resources and Energy (DMRE), Eskom and the South African Local Government Association (SALGA), was approached by Eskom (Generation) to — provide support in analysing the implications of the planned power sector reform as well as the introduction of competitive markets for electricity/other system or ancillary services on Eskom Generation's current business model; — provide support in identifying the skills required in the company in the future; — assist in developing sound adaptation and transition strategies for the future, including a more renewables-based generation portfolio and potential business opportunities arising from an emerging green hydrogen economy in South Africa and globally. GIZ-SAGEN would like to respond to this request and is looking for expert consulting services to: 1) Develop background material on international best practices and experiences for relevant adaptation and transition strategies of formerly fossil fuel dominant generation companies to renewable energy generation, with particular attention to opportunities arising from a developing green hydrogen economy in South Africa and globally (Work Package 1); 2) Conduct three two-day strategy seminars with 10-20 Eskom Generation representatives on the content of the background material with the objective of developing ideas for adaptation and transition strategies for Eskom (Generation), including strategies for participation in renewable energy generation and in an emerging green hydrogen economy in South Africa and globally (Work Package 2); 3) Summarise the results of the strategy seminars in a final report that also provides recommendations on suitable adaptation and transition strategies that can be further developed in a Roadmap under Work Package 4 (Work Package 3); 4) Develop a Roadmap on the future strategic direction for Eskom Generation based on the results and recommendation in the final report (Work Package 4).