• A legal dispute now before the courts highlights a rapidly emerging fault line in South Africa’s energy transition.
• There is intensifying competition among renewable energy developers for scarce grid connection capacity.
• In the case at hand, Mulilo contends it secured grid access approval from Eskom and the National Transmission Company of SA, which was unlawfully reallocated. Eskom disagrees.
• For more financial news, go to News24 Business. 
  

The case – Mulilo Renewable Energy v Eskom Holdings SOC Ltd and Others (Case No. 2025-212230) – is being heard in the High Court, Gauteng Division, Johannesburg.

At issue is Eskom and the National Transmission Company of South Africa’s (NTCSA) decision to cancel previously allocated grid access for a 240 MW privately procured solar PV project and reallocate that capacity to publicly procured REIPPPP Bid Window 7 projects associated with Norwegian developer Scatec.

Following a hearing late last year, the High Court granted an interim interdict on 5 December 2025 in favour of Mulilo, restraining Eskom and NTCSA from utilising the disputed capacity pending determination of the main application. The court directed that the substantive relief sought in Part B must be heard by no later than 30 June 2026.

While centred on a specific project, the dispute reflects a broader systemic challenge: transmission constraints are increasingly shaping – and in some cases distorting – renewable energy development.

Disputed grid capacity

The litigation concerns 240 MW of transmission capacity previously reserved for Mulilo’s “Nepal” solar PV project.

Mulilo contends it had secured grid access approval from Eskom and NTCSA and that Eskom’s subsequent attempt to cancel and reallocate that capacity – to the Leeuwspruit Solar 1, Oslaagte Solar 2 and Oslaagte Solar 3 projects linked to Scatec – was unlawful.

Mulilo approached the High Court for urgent relief, citing Eskom, NTCSA, NERSA, Scatec and the associated IPP project companies as respondents. The court granted an interim interdict preventing reallocation of the capacity pending resolution of the main dispute.

Eskom’s justification

Eskom’s case rests largely on the allegation that Mulilo failed to register its project with NERSA within required timeframes, causing the grid reservation to lapse.

However, the regulatory framework is not always clear-cut. Privately procured projects must be registered with NERSA, while publicly procured projects require licensing – but the timing and sequencing of these processes are not always well defined.

This lack of clarity appears central to the dispute. Mulilo maintains that its grid rights remain valid and that Eskom’s cancellation was unlawful.

Eskom seeks leave to appeal

Eskom has applied for leave to appeal the interim interdict, reportedly arguing that the ruling could have far-reaching implications for both public procurement programmes and privately developed projects.

Notably, Scatec has not joined the appeal and has indicated its willingness to proceed directly to the Part B hearing.

Leave to appeal has not yet been granted, and the interim interdict remains in force. The hearing of the main application has since been brought forward and set down for 9 and 10 April 2026.

Grid capacity as the new constraint

The case underscores a fundamental shift: grid capacity has become one of the most constrained and contested resources in South Africa’s energy transition.

While renewable plants can often be developed relatively quickly, connecting them to the transmission network is increasingly difficult. Key regions – notably the Northern Cape and parts of the Free State – are approaching grid saturation.

Applications for grid access now far exceed available capacity, while transmission expansion has lagged. As a result, grid access approvals have become critical commercial assets that can determine whether projects proceed or fail.

Rising legal contestation

The Mulilo case is among the clearest indications yet that grid access disputes are moving into the courts. Similar tensions are emerging wherever multiple developers compete for limited capacity.

Developers have raised concerns about uncertainty in allocation processes, inconsistent application of project milestones, and the risk of losing grid reservations due to regulatory delays beyond their control.

With billions of rands at stake, these issues are becoming increasingly contentious, while system operators must balance competing claims within a constrained network.

Implications for the energy transition

The outcome of the case could shape the rules and dispute resolution processes governing grid access going forward.

A key question is under what circumstances, conditions and due processes Eskom or NTCSA may cancel previously granted grid reservations. If such decisions lack clear, transparent rules, disputes escalate into litigation, projects get delayed, and investor confidence is undermined.

Conversely, if reservations are too difficult to revoke, capacity may be locked up by stalled projects, preventing others from connecting.

The case may also highlight the need for greater clarity in NERSA’s registration and licensing processes. Delays outside developers’ control can have material consequences where grid access is contingent on regulatory milestones.

At a broader level, the dispute comes at a time when South Africa is transitioning towards a more independent transmission system operator under NTCSA. Confidence in the fairness, consistency and independence of grid allocation decisions will be critical.

Warning for the sector

The Mulilo–Eskom–Scatec dispute may prove to be an early indicator of a wider trend.

South Africa is planning significant renewable energy expansion, but without accelerated transmission investment – particularly in high-resource regions – grid capacity will remain a binding constraint.

As that constraint tightens, disputes over access are likely to increase, with allocation decisions playing an ever more decisive role in determining which projects proceed.

For investors, developers and policymakers, the lesson is becoming increasingly clear: building renewable power plants may be easier than securing the transmission capacity needed to connect them to the grid.

The High Court’s decision in this case may therefore become an important early test of how South Africa manages growing competition for access to its electricity network.

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