The mandate of the Electricity Regulation is the Economic Regulation of the electricity industry and is derived from the Electricity Regulation Act. The division has four departments that serve as a platform to achieve its mandate.
Licensing and Compliance Department, Dispute Resolution and Customer Education
- Issues licences with conditions for: the operation of generation, transmission, or distribution facilities;
- Import/export of electricity;
- Traders of electricity;
- Registers those who provide the above services but exempted by the act from holding a license; and
- Monitors compliance with licence conditions by licensees and enforces compliance where license conditions are breached.
- Resolves disputes between industry players and Market Participants, Licensees and their customers through Mediation and arbitration.
- Facilitates stakeholder engagement initiatives by delivering targeted educational programs that enhance awareness of NERSA’s mandate, operations, and key developments within the energy sector.
Pricing and Tariffs
Economic regulation of the electricity supply industry by NERSA, including the approval and oversight of electricity tariffs and prices from licensees by: -- Specifying applicable tariff guidelines and structures
- Specifying applicable Tariff methodologies (e.g.: Rate of Return, Multi Year Price Determination, and Cost of Supply Framework)
- Evaluating and approving tariff applications from licensees
- Evaluating and approving Negotiated Pricing Agreement from Eskom
- Development of Rules and Pricing frameworks for evaluating tariff applications from licensees
Electricity Infrastructure Planning
- Planning for the country’s future electricity demand/needs (National Integrated Resource Plan)
- Promoting alternative electricity generation technologies eg. Renewable Energy, Cogeneration
- Promoting demand side management and energy efficiency initiatives
- Managing the Grid Code development and enforcement
Market Surveillance Unit
The Market Surveillance Unit (MSU) is a dedicated unit within the National Energy Regulator of South Africa (NERSA). It is responsible for monitoring and overseeing the integrity of the South African Wholesale Electricity Market (SAWEM) the market through which electricity is bought, sold, and priced at a wholesale level in South Africa.The MSU operates independently within NERSA. Its work is grounded in the Electricity Regulation Amendment Act (ERAA), the Market Code, and the Market Rules for SAWEM. Together these instruments establish, the legal basis, institutional design, and operational mandate of the unit.
The MSU carries out four core functions:
1 Monitoring
The MSU continuously monitors trading activity, bidding behaviour, dispatch outcomes, and settlement results across the SAWEM. It analyses market data in real time and over time to detect patterns that may indicate unfair or abusive conduct.
2 Investigation
Where monitoring identifies a concern, the MSU conducts structured investigations to determine whether a breach of the Market Code, applicable rules, or NERSA's regulatory instruments has occurred. Investigations follow a fair and transparent process, with affected parties given the opportunity to respond.
3 Enforcement
Where a breach is confirmed, the MSU takes proportionate enforcement action. This may include issuing compliance directives, imposing administrative penalties, or where conduct is serious enough to constitute a criminal offence referring the matter to the appropriate criminal authorities.
4 Transparency and Reporting
The MSU publishes regular market assessments and surveillance reports to keep market participants, stakeholders, and the public informed about the health and integrity of the SAWEM. Transparency is fundamental to market confidence.
- Market Conduct and Abuse
- Enforcement of SAWEM
- Governance of SAWEM
- Transparency and Reporting of SAWEM market
