Eskom’s 36% Profit Surge, Grid Stability, and the 5GW Renewable Opportunity in 2026

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Eskom has delivered its strongest signal yet that its turnaround plan is taking hold. The utility reported a 36 percent surge in profit, with profit after tax rising to R24.3 billion for the first six months of FY2026, according to its unaudited H1 report. Management attributes the improvement to stricter maintenance discipline, fewer plant breakdowns, declining diesel use, and tighter cost control. After years defined by financial strain, emergency spending, and erratic generation, Eskom’s latest earnings release suggests that operational stability is finally translating into financial resilience.

This financial recovery is not happening in a vacuum. It coincides with one of Eskom’s most consistent periods of operational improvement in nearly a decade. Between 31 October and 28 November, the utility published five weekly system updates showing year-on-year reductions in unplanned outages ranging between 763 MW and 2,376 MW, alongside a steady upward trend in the Energy Availability Factor (EAF). With less breakdown capacity and fewer emergency interventions, the grid has begun operating with a level of predictability that has been rare in recent years.

The implications are material

For South Africa, a more stable Eskom is more than an internal success story. It reshapes the country’s economic and energy outlook. Persistent instability in the grid has been one of the biggest drags on industrial output, investor confidence, and the feasibility of large-scale renewable projects. The steady rise in EAF: from 63.29% (Oct 31-Nov 6) to 68.48% (Nov 21-27), reduces load-shedding pressure and strengthens the base upon which new solar, wind, and battery projects must be integrated, potentially unlocking 5GW via REIPPPP bids in 2026.

The extended life of Koeberg’s Unit 2 (to 2045) is particularly important. Reliable nuclear output eases pressure on ageing coal units (now at <20% UCLF unplanned losses) and supports a smoother transition toward a lower-carbon mix. Meanwhile, declining diesel expenditure (down to R6.185bn YTD, vs. last year’s higher burn) reduces one of Eskom’s most costly and unsustainable operational burdens. When emergency diesel usage falls, cash flow improves, price pressures ease, and the utility’s balance sheet strengthens, freeing R320bn over 5 years for transmission upgrades and RE integration.

Questions?

How much profit goes to renewables/transmission?

All of it: R24.3bn feeds into a R320bn 5-year capex plan, with ~40% targeted at grid hardening for renewable energy integration and 20% for new clean capacity.

Is the profit surge sustainable?

That depends on whether reduced outages and lower diesel use hold through South Africa’s peak-demand months. If this trend breaks under seasonal pressure, the financial gains may soften.

Does this mean load-shedding is over?
No. It means the risk is lower. Structural reliability still requires new capacity, transmission expansion, and consistent maintenance; only 26 hours of shedding so far in H1 FY26

What does this mean for renewables?
A stable grid accelerates grid-connection approvals, reduces curtailment risk, and strengthens the case for large-scale storage. E.g. faster REIPPPP rounds for 2-3GW solar/wind.

Deals & Investment

Nigeria: AfDB approved a $500 million loan for Nigeria to drive energy-sector reforms and accelerate its clean-energy transition, packaged alongside broader economic-governance support. AfDB

Mauritania: Wärtsilä has signed a three-year performance-agreement with Société Mauritanienne d’Electricité (SOMELEC) to manage and maintain a 34 MW power plant in Nouadhibou, Mauritania. Wärtsilä

Liberia: African Development Fund invests over $7 million to complete run-of-river hydropower plant and related infrastructure project. AfDB

South Africa: Candi Solar secured a US $58.5 million financing package led by International Finance Corporation (IFC) for distributed solar deployment across South Africa and India. Candid Solar

Zambia: GreenCo and Stanbic Bank Zambia (part of Standard Bank Group) signed a US$ 55.5 million financing agreement to prepay over 130 MW of electricity imports, providing urgent relief to power-short Zambia amid its ongoing energy crisis. GreenCo

Sub-Saharan Africa: Octopus Energy has joined the Scaling Up Renewables in Africa campaign, committing up to USD 450 million under its “Power Africa Initiative” to accelerate solar, wind, grid, and digital-infrastructure deployment, potentially bringing clean electricity to over 1.1 million people in Sub-Saharan Africa. Octopus

Africa: The AfDB and partners hosted the inaugural “Mission 300 Day” on the sidelines of the Africa Investment Forum (AIF) 2025 Market Days in Rabat, Morocco. AfDB

Africa: The Africa Investment Forum secured USD 15.3 billion in commitments for 39 bankable projects at its 2025 Rabat gathering, with nearly two-thirds of the pipeline directed toward energy and transport, signalling a strong surge in capital for Africa’s power and infrastructure build-out. Africa Investment Forum

Africa: Global Citizen concluded its first African summit in Johannesburg with new SURA pledges targeting 26.8 GW of renewables and electricity access for 17.5 million African homes by 2030. Global Citizen

Regulation and Policy Updates

South Africa: The National Energy Regulator of South Africa (NERSA) approved market operator licence for the National Transmission Company of South Africa (NTCSA) and establishment of electricity market advisory forum. NERSA

Zambia: Cooma Solar Power Plant in Zambia has signed an Investment Promotion and Protection Agreement (IPPA) with Zambia Development Agency (ZDA), to accelerate its 50 MW solar plus 20 MW battery storage project toward financial close and implementation. Energy News Network

Zambia: Zambia has unveiled a new energy roadmap combining solar, coal and hydro projects to address its electricity crisis and diversify the country’s energy mix. Lusaka Times

Executive Takeaways:

Nuclear stability (Koeberg Unit 2 to 2045) strengthens baseload and eases the transition away from coal: Long-term nuclear certainty reduces pressure on ageing coal plants (now <20 percent UCLF), improving the reliability baseline for integrating intermittent renewables.

Continental investment sentiment is trending upward, driven by multilateral capital: Major deals; including Nigeria’s $500 million AfDB reform package, Zambia’s $55.5 million energy-security financing, and Octopus’s $450 million renewables commitment, show momentum for large-scale clean-energy deployment despite macroeconomic headwinds.

Market Momentum from Forums: AIF 2025’s $15.3bn commitments (39 projects, 2/3 energy-focused) and Mission 300 Day’s compact finalization drive Q1 2026 deal closures, while Global Citizen’s SURA pledges (26.8GW renewables) and Octopus Energy’s $450m initiative spur off-grid solar deployments, benefiting 1.1m+ people and creating 10,000+ short-term construction jobs in Sub-Saharan hubs like Zambia and Nigeria.

What to Watch This Week

West Africa Energy Cooperation Summit 2025: (2-3 December 2025, Accra, Ghana). The event will bring together the 16 countries of West Africa and its neighbours in productive discussions on how the region and the public and private sector can work in collaboration to unleash its energy potential. Energy news Network

Renewable Energy Forum Africa (REFA): (3-4 December 2025, Accra, Ghana). The event is designed for professionals of the African renewables industry to convene, meet and advance renewable energy projects on the continent. AfsiaSolar

Afsia Awards 2025: (3 December 2025, Accra, Ghana). The event is designed to recognize and celebrate exceptional talent and achievements in the African solar and storage market. AfsiaSolar

The West African Power and Energy Cooperation Conference (WAPECC): (3-5 December 2025, Cotonou, Benin). The event serves as a crucial platform to address the pressing challenges and leverage the opportunities in the region’s energy and infrastructure sector. Wapecc

MSGBC Oil, Gas and Power 2025: (8-10 December 2025, Dakar, Senegal). The event offers access to West Africa’s burgeoning energy market. MSGBC