Corporate power purchase agreements (PPAs) are set to drive more utility-scale renewable capacity additions in South Africa than government auctions for the first time in 2026, according to a report by BloombergNEF (BNEF).

BNEF expects corporate buyers to support 73% of the 2.3 GW of anticipated solar and wind additions.

Since 2020, corporates have contracted about 5 GW of clean power, with demand accelerating after the cap on private power projects was removed in 2023. Corporate PPAs supported about 670 MW, or 48%, of the 1.4 GW tracked in 2025, with major buyers including Sibanye Stillwater, Rio Tinto, Tronox, Air Liquide and Sasol.

BNEF said corporate PPAs are poised to remain the main driver of renewables through the end of the decade, with 90% of respondents to its PPA price survey expecting to sell more through PPAs than through the South African Wholesale Electricity Market, whose launch has been delayed and is now expected in stages from the second quarter of 2027.

The survey showed average solar PPA prices are expected to fall to 848 rand/MWh ($53.7/MWh) in 2026, while onshore wind prices are projected to rise marginally to 1,104 rand/MWh. Solar PPAs averaged 935 rand/MWh from 2024 to 2025, compared with 1,102 rand/MWh for wind.

BNEF said transmission capacity is now emerging as a key constraint on further growth. In its long-term scenarios, coal supplied 78% of South Africa's electricity in 2025, down from 90% in 2015, with solar and wind projected to supply 69% of annual generation by 2050 while coal falls to 21% as ageing plants retire.