Publication - The Electricity Distribution Industry in Germany and South Africa – A Review of Policy and Regulation

From energypedia

►Add a New Publication
►See All Latest Publications

The Electricity Distribution Industry in Germany and South Africa – A Review of Policy and Regulation
South African-German Energy Partnership
Tobias Zeller
Published in
October 2018
With 900 German Stadtwerke and 180 South African municipal utilities, both Germany and South Africa possess a similarly structured electricity distribution industry. The South African-German Energy Partnership in cooperation with SAGEN, the South African-German Energy Programme, supports South African partners in their debate about future Energy Market Design and Municipal Utility Business Models.

A new discussion paper summarises the challenges and opportunities of changes in the German power market triggered by liberalisation and the Energiewende, and relates them to the energy transition challenge in South Africa. Based on German and South African experiences, the paper formulates suggestions for municipal utilities and a possible way forward for a new electricity distribution market design in South Africa.

Among others, the discussion paper suggests a shift of the general business model from the current 'bundle' tariffs (bundling of network and supply) to tariffs that are based on use-of-system charges, allowing new business models and tariffs for wheeling, third party access, etc.

The recommendations also suggest developing and testing new business models that focus on customer retention, new sources of revenue or improved services. Here, opportunities may include digitalisation and the leasing of generation assets (e.g. rooftop-photovoltaic systems or charging stations for e-vehicles).

Implemented by GIZ on behalf of BMWi, the South African-German Energy Partnership helps to develop sustainable solutions for dealing with the challenges of the South African Energy Transition.