NERSA registration and solar wheeling, explained

Electricity generation, transmission, distribution, trading and imports are regulated by the Electricity Regulation Act 4 of 2006, administered by the National Energy Regulator of South Africa (NERSA). Schedule 2 of the Act sets out which activities are exempt from licensing and which of those still have to be registered with NERSA. Schedule 2 has been amended several times in recent years, and the amendments materially moved the thresholds, which is why older guidance circulating online is often wrong.

Getting the category right matters because it determines whether you file a registration or a full licence application, and those are months apart in effort.

Broadly, projects fall into three buckets:

• Neither. A small facility for your own use, not connected to the grid or connected without exporting, may fall below the registration threshold entirely. It still needs municipal and grid-operator sign-off.
• Registration. The large majority of commercial rooftop and ground-mount projects sit here: exempt from licensing but required to register the facility with NERSA, with a connection or use-of-system agreement from the network operator behind it.
• Licence. Larger facilities and anyone conducting trading, distribution or reselling of electricity generally require a licence, which is a substantially heavier process involving a public participation phase and NERSA decision at an energy regulator meeting.

Because the thresholds have shifted, we confirm the current category against the applicable version of Schedule 2 in writing as the first step of every mandate, before anything is filed.

Wheeling means generating power at one point and using the existing network to deliver it to an offtaker somewhere else. Nobody builds a private line. You are renting network capacity, so a wheeling arrangement is really four agreements plus a metering reality:

• The power purchase agreement between the generator and the offtaker: tariff, escalation, volume commitment, curtailment, term, and what happens if the offtaker's demand changes.
• The use-of-system or wheeling agreement with the network operator, whether Eskom or a municipality, setting the wheeling charge and losses.
• Connection agreements at both the injection and offtake points, with the associated cost estimate letter and budget quote.
• Settlement and metering: compliant metering at both ends and an agreed reconciliation method, which is where most disputes later arise.

The commercial trap is municipal distribution. Where the offtaker sits inside a municipal distribution area, that municipality has to accommodate wheeling, and not all of them have a framework or tariff in place. Confirming that before signing a power purchase agreement is the difference between a bankable deal and a stranded one.

Energy approval and environmental approval are separate tracks that both have to land. Depending on capacity, footprint and site sensitivity, a generation facility and its grid infrastructure can trigger listed activities requiring an environmental authorisation under NEMA. Rooftop installations usually do not; greenfield ground-mount projects and new lines often do.

Run the listing exercise at the same time as the NERSA categorisation. Discovering an environmental trigger after the connection process has started is the most expensive sequencing mistake in this sector.

Planning figures we work to:

• Registration: our preparation takes 2 to 4 weeks once the technical pack is available; NERSA's decision typically follows within a few months.
• Licence: 6 to 12 months, driven by NERSA's public participation and meeting cycle rather than by drafting time.
• Grid connection: the network operator's cost estimate and budget quote process usually sets the critical path and can run several months on its own.

Our fees are all-in and fixed, agreed in writing before any work starts: small-scale registration at R25,000, NERSA registration with grid connection at R95,000, a generation, trading or distribution licence at R65,000, and a full solar wheeling and power purchase agreement package at R185,000. Regulator and departmental fees are included.