A fragmented and poorly coordinated policy and execution environment is placing South Africa’s gas-to-power ambitions at risk, with industry leaders warning that delays could leave the country exposed to a looming gas supply gap.
Speaking during an industry webinar on March 25, Thabiso Tenyane, Group CEO and Executive Chairman of the Phakwe Group, said misaligned policy frameworks and a lack of coordinated execution continue to constrain development.
“The timelines of key frameworks, including the Gas Master Plan, IRP 2025 and liquid fuels infrastructure planning, remain misaligned. Shifting policy positions across successive administrations have further heightened uncertainty, undermining progress across the value chain and delaying investment decisions,” he said.
Richards Bay remains the most advanced site for gas-to-power development, but progress is constrained by a lack of synchronisation between infrastructure, supply and power generation.
“You cannot build a power plant without certainty on infrastructure and gas supply,” Tenyane said.
He called on Electricity and Energy Minister Kgosientsho Ramokgopa to intervene urgently, warning that current timelines are no longer credible.
“Based on current projections, preferred bidders may only be appointed by mid-2027, with financial close extending into late 2028 and construction beginning in 2029,” he said.
Delays in turbine delivery, combined with tightening global supply, could push commissioning to between 2032 and 2034 – well beyond the expected supply gap around 2030. Capital costs have also increased from around $1-million/MW to approximately $1.6-million/MW, raising concerns about tariff competitiveness.
Improved framework, but execution risks remain
Paul Eardley-Taylor, Gas Sector Lead at Standard Bank, said recent revisions to the request for proposals for Bid Window 1 of the Gas-to-Power Independent Power Producer (IPP) Procurement Programme represent a step forward.
These include the appointment of international gas advisers and the unbundling of gas pricing into two components: Fuel Cost Recovery (FCR), reflecting international gas prices, and FFCCR, covering infrastructure costs such as terminals, regasification, storage and transmission. The move to a fixed 50% load factor was also welcomed, although uncertainty remains around higher utilisation scenarios.
Eardley-Taylor said turbine lead times are now approaching four years, while global LNG supply is expected to expand significantly. Mozambique is emerging as a key regional supplier, with capacity already operational and under development.
However, execution risks remain high. He noted that demand, fuel delivery and import infrastructure are being developed in parallel rather than in an integrated manner, creating complexity and delays.
He argued that LNG import terminals should be prioritised to build market confidence, with potential for operation by around 2029 if supported by progress in the Gas IPP programme.
Thomas Shaw, chairperson of GasHub, said infrastructure investment depends on a clear and committed demand profile anchored by gas-to-power, as industrial demand alone is insufficient to support large-scale development.
Policy intent, he said, must be supported by firm timelines and binding commitments on when gas will flow, alongside fiscal measures to de-risk infrastructure.
Shaw also called for a central coordinating structure, similar to the National Energy Crisis Committee, to align the sector.
Motlokwe Sebake, GM for Commercial and Stakeholder Management at ROMPCO, said the company’s cross-border pipeline has supported the gas market for more than two decades but is now entering a transition phase as supply from Mozambique’s Pande-Temane fields declines.
He said ROMPCO is working to strengthen regional partnerships and prepare for new supply sources to support the next phase of gas development across Southern Africa.
Industry participants were aligned that without coordinated leadership, investor appetite and gas demand will not translate into project execution.
Tenyane said responsibility ultimately rests with government to drive implementation.
“We cannot sit around and say the gas cliff is not being resolved. It must be resolved or else the biggest economy in the country, Gauteng, will collapse,” he said.
