South Africa's Largest Private Hybrid Project at Financial Close Is Now the Wheeling Blueprint Every C&I Buyer Must Study: What the Naos 1 300 MW Solar + 660 MWh BESS Multi-Off-Taker Model Means for Portfolio PPA Structuring, Grid-Wheeled Supply Contracts, and AI-Managed Dispatch in H2 2026

Why Naos 1 Changes Everything for C&I Energy Buyers

In February 2026, South Africa's renewable energy market crossed a threshold that C&I procurement teams can no longer afford to ignore. SOLA Group reached financial close on its Naos‑1 Hybrid Solar and Battery Project — the country's first utility‑scale solar PV and battery energy storage project purpose-built for wheeling power to private end-users across the grid. It is not merely another megaproject headline. It is the living proof-of-concept for every multi-site commercial property owner who has been told that grid-wheeled, BESS-backed renewable supply "isn't ready yet." It is ready. And the structuring decisions you make in H2 2026 will determine whether your portfolio benefits from the next wave — or pays an increasingly punishing Eskom bill for the next decade.

The Project at a Glance

The project features a 300 MW (435 MWp) solar PV facility co-located with 660 MWh of battery storage, supported by 25‑year power purchase agreements with Sasol and Air Liquide — two major industrial energy consumers — and is the largest privately contracted hybrid renewable energy project to reach financial close in South Africa to date.

Located near Viljoenskroon in the Free State province, Naos‑1 was developed, designed, implemented, and will be operated by SOLA Group. Construction is being delivered by WBHO, with financial close confirmed in February 2026. On the storage side, Envision Energy has signed a 660 MWh BESS supply agreement with SOLA Group and WBHO for the project. Envision's scope covers design, manufacturing, commissioning, operation, and maintenance of the storage system under a 25-year long-term service agreement.

Unlike conventional renewable energy projects that supply power through a single grid connection, Naos‑1 is designed around a wheeling model — allowing electricity generated at the site to be transmitted through Eskom's national transmission network to multiple corporate offtakers across the country. While comparable government-backed projects like Red Sands supply the national transmission operator, Naos‑1 is structured to provide renewable electricity directly to private corporate customers under long-term commercial agreements.

The Regulatory Ground Naos 1 Stands On

For commercial property owners unfamiliar with the legislative evolution, here is the condensed timeline that makes Naos 1 possible and replicable:

• ERA Amendment (2021): The amendment of the Electricity Regulation Act 4 of 2006 in August 2021 was the first fundamental step to unlocking the private electricity generation and procurement market, dispensing with the need for a licence for projects below 100 MW and amending Schedule II to allow for the wheeling of electricity to multiple customers.
• NERSA Wheeling Framework (2025): A new wheeling amendment was approved by NERSA on 3 March 2025 and officially released by the Department of Electricity and Energy — determining applicable charges for the use of the system by both generators and loads connected to the transmission and/or distribution networks, and allowing other parties to access those networks.
• Virtual Wheeling Platform: Eskom developed its Virtual Wheeling Platform (VWP) as a digital mechanism to aggregate Time-of-Use generation and consumption data, allowing Eskom to refund a single buyer while individual offtake sites continue to consume electricity and be billed as before.
• FY2027 Tariff Structure: Eskom's standard prices for direct customers increased by 8.76% effective 1 April 2026, with municipal bulk purchases adjusted by 9.01% effective 1 July 2026. Critically for wheeling buyers, the portion of the Generation Capacity Charge included in the energy charge is now excluded from the energy credit provided under wheeling and net-billing — a structural shift buyers must model carefully.

There is a common misconception that wheeling charges are additional charges — this is not the case, since all customers, whether buying from Eskom or private generators, pay the same network charges. The only additional charge is the administration fee to facilitate the wheeling transaction.

The Multi-Off-Taker Model: What It Means for Portfolio PPA Structuring

The prevailing types of corporate PPAs in South Africa take the form of either on-site or off/near-site private wire agreements, or are offsite physical PPAs structured on a wheeled basis. Naos 1 demonstrates a third, more powerful configuration: a single hybrid generation asset serving multiple large industrial off-takers simultaneously through long-term wheeling PPAs. For commercial property owners managing multi-asset portfolios, this opens three structural options in H2 2026:

1. Direct Off-Take via a Bilateral Wheeling PPA

For a wheeled CPPA, the corporate concludes a PPA with an IPP and electricity is 'wheeled' by the utility from the IPP to the corporate via the grid — a bilateral arrangement that regulates the purchase of renewable power. This suits large single-site buyers consuming above 1 MVA with direct Eskom connections. Third-party wheeling is currently subject to the buyer being connected on a medium-voltage (MV) or higher-voltage network and being on a time-of-use (TOU) tariff.

2. Aggregated Multi-Site Procurement via Virtual Wheeling

Where the buyer is a corporate entity with multiple offtake sites in different municipal jurisdictions, virtual wheeling allows Eskom to pay the buyer a wheeled energy refund at WEPS TOU rates for energy generated by the IPPs, while individual offtake sites continue to be billed as usual by their relevant municipalities. This is the breakthrough structure for retail property funds, hospitality groups, and logistics operators with geographically dispersed assets — no amendment to existing Electricity Supply Agreements is required.

3. Trader-Intermediated Sleeved Supply

The Virtual Wheeling Platform also provides electricity traders with the opportunity to purchase and aggregate energy from one or more generators and allocate it to multiple offtakers. For buyers below the 1 MVA threshold or on municipal connections without a formal wheeling framework, a licensed electricity trader can intermediate — acquiring green power from IPPs and selling it to consumers under long-term PPAs of up to 20 years, while negotiating and paying wheeling fees to the owners of the transmission and distribution grids.

BESS + AI Dispatch: The Silent Game-Changer in H2 2026

The 660 MWh Envision BESS at Naos 1 is not simply backup insurance. It is the instrument that transforms an intermittent solar resource into a dispatchable, contract-grade supply product. Naos‑1 combines 300 MW of solar PV generation with 660 MWh of battery storage to deliver reliable, dispatchable renewable power to major private businesses — demonstrating how integrated renewable and storage solutions can redefine future energy systems, delivering not only clean power, but also reliability, flexibility, and economic value at scale.

For C&I buyers, the practical implications are significant. In an AI-managed dispatch model, the BESS is charged during peak solar generation periods and discharged during Eskom's peak TOU windows — typically 07:00–10:00 and 18:00–21:00. Eskom's Homeflex tariff and some municipal TOU structures charge different rates at peak versus off-peak hours, and with a battery system, buyers can optimise by charging from cheap overnight power and discharging during peak hours — significantly improving solar ROI. At utility scale, algorithmic dispatch can simultaneously satisfy PPA delivery obligations across multiple buyers while maximising grid-credit value under the WEPS mechanism.

The integration of solar and storage is expected to enhance grid stability and address the intermittency challenges associated with renewable energy — a guarantee no rooftop solar installation alone can offer.

Five Practical Decisions for C&I Buyers Right Now

South Africa's commercial and industrial energy market is entering a decisive phase. Rising costs, ongoing grid instability, and increasing ESG pressure are forcing organisations to move beyond planning and into implementation. Here is what to do before December 2026:

• Audit your connection voltage and tariff class. Wheeling currently requires buyers to be connected at MV or higher voltage on a TOU tariff. Wheeling for low-voltage (<1 kV) customers is not yet permitted, though it is being investigated. If your properties are low-voltage, model a trader-intermediated structure now.
• Model the new GCC exclusion into your wheeling economics. The portion of the GCC included in the energy charge is excluded from the energy credit provided under wheeling and net-billing — meaning your net wheeling savings calculation from 2025 is no longer accurate. Re-model with your energy advisor using the updated FY2027 Eskom wheeling tool.
• Assess your municipal wheeling readiness. Where the offtaker has a municipal point of connection to the grid, wheeling is only possible insofar as the municipality has adopted a formal wheeling framework, inclusive of a tariff and billing policy. Check the SALGA framework register and your municipality's status before committing to a physical wheeling PPA.
• Negotiate BESS dispatch guarantees into your PPA term sheet. Unlike a pure solar PPA, a hybrid project with co-located BESS can contractually commit to minimum hourly delivery volumes at peak TOU windows. Insist on this — it converts a renewable tariff hedge into a true supply contract.
• Lock in 20–25 year escalation caps before NERSA's next MYPD cycle. Eskom tariffs have historically exhibited annual increases surpassing inflation — but the emergence of corporate PPAs spanning 10 to 20 years presents an energy cost savings opportunity for corporate buyers. Naos 1 illustrates how large-scale renewable energy projects are increasingly attracting private investment without relying on government-backed procurement programmes.

The Bottom Line

As the largest privately contracted hybrid renewable energy initiative to reach financial close in South Africa, Naos‑1 highlights the country's shift toward more flexible, market-driven, and low-carbon power systems. For commercial property owners, it signals that the infrastructure, regulation, and financing structures required for scalable grid-wheeled hybrid supply are no longer theoretical. The Naos 1 blueprint — utility-scale solar, co-located BESS, AI-managed TOU dispatch, multi-off-taker PPAs wheeled across the national grid — is the template. The question is not whether this model works. The question is whether your portfolio will be part of the next tranche.

At SolarXgen, we are actively structuring grid-wheeled C&I offtake packages drawing on this exact model. Contact our team for a no-obligation portfolio PPA scoping assessment.