Electricity Market Code 2026: What C&I Prosumers Must Do Before June

South Africa's electricity market is undergoing its most fundamental structural overhaul in over a century — and the clock is ticking for commercial and industrial (C&I) prosumers. A phased Market Code implementation begins in April 2026, coinciding with fresh NERSA-approved tariff hikes and a tightening SSEG registration regime. If you own, manage, or operate a commercial property with on-site generation — or are planning to install solar this year — the decisions you make before June 2026 will determine your compliance standing, your energy costs, and your access to the emerging open electricity market for the next decade.

What Is the Electricity Market Code — and Why Does It Matter to You?

The Market Code is not just a regulatory document for utilities. Confirmed by the 2026 State of the Nation Address and now entering its first implementation phase, it is the rulebook for how electricity is generated, traded, wheeled, and settled across South Africa's evolving competitive market. According to Baker McKenzie's March 2026 analysis, the Market Code — drawing on international competitive market models — will specifically regulate participation rules for generators, traders, and prosumers, use-of-system charges and grid access methodologies, and market transparency and financial settlement mechanisms.

For C&I prosumers — businesses and property owners who both consume and generate electricity — this is the framework that will govern your relationship with the grid from April 2026 onward. The five-year transition toward full market functionality runs to 2031, but the rules that shape Phase 1 participation are being set right now.

The Tariff Pressure That Makes This Urgent

The commercial case for self-generation has never been stronger — not because load shedding is threatening production (grid stability has materially improved since 2024), but because the trajectory of electricity prices remains steep. NERSA has confirmed two significant tariff increases for 2026:

• 8.76% increase for Eskom direct customers, effective 1 April 2026 to 31 March 2027.
• 9.01% increase for municipal customers, effective 1 July 2026 to 30 June 2027.

This follows the 12.74% Eskom direct increase that took effect on 1 April 2025 and the 11.32% municipal increase from 1 July 2025. The narrative has shifted decisively: the crisis is no longer about reliability — it is about cost. As one industry commentator noted, the conversation has moved from "Will the lights stay on?" to "What will it cost?"

For C&I users, electricity is one of the largest controllable input costs. Every tariff increase that outpaces CPI erodes margin and competitive position. A locked-in Power Purchase Agreement (PPA) or solar lease signed before June 2026 insulates your energy cost from the next round of municipal and Eskom tariff applications — which NERSA is already processing for 2026/27 financial years.

SSEG Registration: The Compliance Line Every C&I Prosumer Must Cross

If your property has grid-tied on-site generation — solar PV, combined heat and power, or any embedded generation system — registration is not optional. NERSA has issued clear guidance:

• Systems under 100kW connected to the grid must register with the relevant distributor — either Eskom or the applicable licensed municipality.
• Systems above 100kW — which covers the majority of C&I commercial and industrial solar installations — must register directly with NERSA.
• Systems without a point of connection to the grid are exempt from registration.

This is the threshold most C&I property owners need to note: a 250kW rooftop installation at a shopping centre, a 500kW system at an industrial facility, or a multi-tenant office block solar scheme — all require direct NERSA registration.

Eskom's Extended Fee Waiver: A Deadline With Teeth

For Eskom-supplied customers with systems up to 50kVA, Eskom has extended its SSEG registration fee waiver to 30 September 2026 — an extension from the original March 2026 deadline. Eligible customers can save up to R9,132 in connection costs, including the cost of a smart bi-directional meter. Compliance documentation has also been simplified since October 2025: a valid Certificate of Compliance (CoC), an inverter test certificate (NRS097), and a basic SSEG installation test report are sufficient for qualifying systems.

Critically, however, this waiver applies primarily to smaller residential and SME systems up to 50kVA. C&I operators with larger installations cannot rely on this waiver — and with NERSA's direct registration pathway, the process involves formal technical submissions, grid connection approval from the relevant Network Service Provider (NSP), and compliance with the South African Grid Code.

Municipal Variation: A Critical Risk for Property Managers

If your properties are in municipal supply areas — which covers most urban commercial nodes in Johannesburg, Cape Town, Tshwane, eThekwini, and Ekurhuleni — your SSEG registration goes through the municipality, not Eskom. Requirements vary significantly: the City of Cape Town, for example, operates under its 2010 Electricity Supply By-law and has its own application portal and technical specifications.

NERSA's net-billing framework, approved in December 2024, delegates significant authority to municipal distributors to design their own specific export tariffs and technical requirements, subject to NERSA's overarching principles of fairness and cost-reflectivity. The financial viability of a solar system in an Eskom-supplied area may be materially different from an identical system in a municipal supply area. Multi-site portfolios must be assessed distributor by distributor.

What the Market Code Phase 1 Means Practically for C&I

NERSA's two-phase trading rules structure has direct implications for how C&I prosumers can participate in the new market:

Phase 1 (Now to market stabilisation)

Phase 1 is focused on transmission and high-voltage customers sourcing energy from licensed traders. Under the new trading rules, generators supplying wheeled energy through Power Purchase Agreements must register their facilities with NERSA, secure a trading licence (for the IPP/developer), and obtain written permission from the relevant NSP for grid connection. Existing PPAs and Electricity Supply Agreements signed during Phase 1 will remain valid as the market evolves — a critical protection for any C&I site signing a long-term PPA today.

Phase 2 (When the market stabilises)

Phase 2 expands participation to all customers. This is when the full promise of the competitive market — choosing your energy supplier, participating in demand-response programmes, and potentially monetising battery storage capacity — becomes accessible to the broader C&I segment. Baker McKenzie's analysis cautions, however, that full private market participation may only materialise in the early 2030s, despite the April 2026 rollout commencement.

The Municipal-to-Network-Service-Provider Shift

One structural change that property managers and CFOs must understand: the new trading rules introduce a shift that moves municipalities from energy retailers to regulated Network Service Providers (NSPs). This has profound implications for how wheeling agreements, embedded generation tariffs, and grid access charges are structured going forward. If your current SSEG or wheeling arrangement was negotiated under legacy municipal retail terms, it may need to be revisited as municipalities adapt to their new regulatory role.

Your Six-Point Action Plan Before June 2026

1. Audit your existing installations. Identify every grid-tied generation asset on every property in your portfolio. Confirm whether each installation is registered, pending, or unregistered — and determine which registrations fall under municipal jurisdiction versus direct NERSA registration (the 100kW threshold is the key split).
2. Prioritise NERSA direct registration for systems above 100kW. This is not a simple online form — it requires technical documentation, compliance with grid codes, and engagement with your NSP. Allow 60–90 days minimum for the process. Engage an accredited energy consultant or your solar developer immediately.
3. Review your municipal distributor's SSEG export tariff. Under the national net-billing framework, export credits are set at a lower rate than your import tariff. Know exactly what your municipality pays you for exported energy — because this directly affects the sizing decision for your solar-plus-BESS system. A system optimised for self-consumption will outperform one optimised for export in most C&I scenarios.
4. Lock in a PPA or funded model before the next municipal tariff cycle. The July 2026 municipal tariff increase of 9.01% is already confirmed. PPAs signed now can lock in an energy cost escalation of 5–7% per annum — significantly below NERSA's approved trajectory. Zero-capex funded models mean no capital outlay required.
5. Size your BESS for the new tariff structure. With time-of-use pricing becoming more prevalent and peak-demand charges forming a growing share of C&I bills, BESS is no longer just a load shedding hedge. It is a tariff arbitrage and demand charge management tool. The right battery size depends on your specific tariff structure, load profile, and export tariff — not a generic rule of thumb.
6. Engage early on wheeling if you have multiple properties. Municipal wheeling frameworks are still maturing across South Africa, but the regulatory groundwork is being laid. If you have generation surplus at one property and consumption deficit at another, wheeling across the distribution network is worth investigating now — before the market hardens its access rules.

Common Questions From CFOs and Facilities Managers

Does my existing solar installation need to be re-registered under the new rules?

Not necessarily re-registered, but it must be registered. Any grid-tied installation that was not formally registered with Eskom or the relevant municipality remains non-compliant under the Electricity Regulation Act. If your system was installed before formal registration processes were enforced, retrospective compliance is required. For systems above 100kW, NERSA direct registration is mandatory regardless of when the system was installed.

What happens if we don't register before the market formalises?

Non-registered systems risk disconnection, and with Phase 1 of the Market Code now live, unregistered generators cannot participate in wheeling arrangements or receive export credits under the net-billing framework. As the market formalises, the compliance bar will only rise. Penalties for connected but unregistered systems are increasingly likely to be enforced as the NSP and NERSA frameworks tighten.

Will our PPA still be valid under the new Market Code?

Yes. NERSA's trading rules explicitly provide that existing PPAs and Electricity Supply Agreements signed during Phase 1 will remain valid, with traders required to comply with the Market Code. This provides strong contractual protection for C&I sites that move now — the rules are designed to preserve investment made under the transition framework.

Should we wait for the market to fully open before investing?

No. The tariff case for C&I solar is compelling today — and delaying costs you real money every month. The 8.76% and 9.01% increases effective April and July 2026 respectively are locked in. A system commissioned this quarter pays back against those higher tariffs from day one. Waiting for a "fully open" market in the early 2030s means paying above-inflation electricity costs for five more years.

The Bottom Line for C&I Decision-Makers

The Electricity Market Code 2026 is not an abstract policy event — it is the structural context in which every solar, BESS, wheeling, and PPA decision your organisation makes this year will operate. The prosumer framework is maturing rapidly: net-billing is live, NERSA registration is mandatory, trading rules are in force, and tariffs are climbing at nearly 9% per annum.

The commercial property owners, industrial operators, and facilities managers who act decisively before June 2026 will enter the new market structure from a position of compliance, cost certainty, and optionality. Those who wait will be negotiating from a position of rising costs, potential non-compliance exposure, and reduced access to the emerging competitive market tools. A no-obligation feasibility assessment — covering your load profile, tariff structure, SSEG registration status, and optimal technology mix — is the right first step. Request one today.