Electricity pricing and sector reform: Distribution utility skills and capacities

This technical report analyzes the evolving role of electricity distributors in South Africa amidst Eskom's unbundling and the emergence of a hybrid energy market. It highlights the shift from a single-supplier model to managing decentralized energy sources and multi-directional energy flows. The paper examines the new functions, such as Distribution System Operator (DSO) and Distribution Energy Trader (DET), and identifies the skills required for this restructured industry. It aims to guide distributors in developing future skills strategies and action plans to participate effectively in the liberalized electricity market, addressing operational inefficiencies and capacity constraints.

Research recommendations:

Electricity distribution companies (Discos) in South Africa must proactively adapt to the liberalizing energy market, shifting from single-supplier reliance to managing diverse, decentralized energy sources and multi-directional flows. A critical need exists for Discos to develop comprehensive skills strategies, action plans, and training assessments for emerging roles like Distribution System Operator (DSO) and Distribution Energy Trader (DET). This transition necessitates exploring cost-efficient wholesale electricity procurement options and addressing current operational inefficiencies and infrastructure backlogs for sustainable participation in the restructured electricity sector.

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