The first anniversary of Vodacom and State-owned power utility Eskom’s virtual wheeling mechanism is a turning point in moving the solution from pilot design into proven operational execution at scale.

Last year, Vodacom became the first company in South Africa to fully operationalise commercial virtual wheeling at scale.

This followed the historic signing of the virtual wheeling agreement in 2023 between the parties. After two years of technical and regulatory work, the mechanism moved from agreement to commercial operation in September 2025.

“This first anniversary represents far more than a year of successful monthly refunds. It is proof that our collaborative efforts have resulted in a workable, scalable solution for the country,” said Vodacom South Africa CEO Sitho Mdlalose.

The virtual wheeling solution was developed to enable South Africa’s private sector to participate in addressing the country’s energy crisis, which, at the time, in 2023, was having a significant impact on the economy.

While work remains to broaden participation and mature supporting systems, the completed 12-month period from September 1 to August 31 provides compelling evidence that virtual wheeling is transitioning from theoretical promise into operational reality.

“Our partnership with Eskom has been transformational. We had four objectives in mind when we approached Eskom with this solution: one, to remove complexity; two, to use technology to overcome legacy limitations; three, to access renewable energy with a sound business case; and four, to encourage private participation in helping to solve the country’s energy crisis,” he said.

This achievement was supported by Mezzanine, the majority-owned Vodacom subsidiary that developed the digital platform that aggregates energy consumption data across multiple distributed sites and reconciles it with energy generated by independent power producers.

Monthly refunds have been processed since November 2025, demonstrating that the contractual mechanisms and digital infrastructure can reliably support complex, auditable energy transactions in real-world operating conditions.

“The successful monthly refunds follow Eskom’s comprehensive reconciliation and confirmation of Vodacom’s monthly claims, demonstrating that the mechanism functions effectively across the complete operational cycle, from data handling and claim validation through to reconciliation and financial settlement,” said Mdlalose.

The implications of this achievement extend beyond Vodacom and Eskom, with the virtual wheeling model providing a replicable blueprint for other large, distributed businesses seeking to access renewable energy without on-site generation.

“By translating a sophisticated market mechanism into an executable business process, virtual wheeling removes technical and operational barriers that have previously constrained private-sector participation in South Africa’s energy transition.”

Mdlalose explained that virtual wheeling fundamentally reimagines how organisations with distributed electricity demand across multiple municipalities can access renewable energy from independent power producers.

Unlike traditional wheeling, which establishes a one-to-one relationship between a generator and buyer, virtual wheeling totals energy consumption across numerous sites and matches it with renewable generation, making it possible for complex, nationwide operations like Vodacom’s to participate meaningfully in the energy transition.

The agreement emerged from Vodacom’s unique operational challenge. With more than 15 000 distributed low-voltage sites spread across 168 licensed municipalities nationwide and direct Eskom supply, the company faced extraordinary complexity in sourcing renewable energy through traditional wheeling structures.

The virtual wheeling solution was co-developed with Eskom specifically to address these limitations and enable Vodacom to pursue its goal of sourcing 100% of its electricity demand from renewable sources.

This innovation is also essential to Vodacom’s climate transition plan, which includes moving to renewable energy and enhancing energy efficiency.

“For Vodacom, this milestone represents significant progress toward our renewable-energy ambitions. But most importantly, for Eskom and South Africa as a whole, it demonstrates that collaborative innovation between public and private stakeholders can deliver tangible progress in solving the country’s energy challenges,” Mdlalose concluded.