An analysis of energy security in local municipalities: A case study of the city of Cape Town

Abstract

South Africa’s centralised electricity generation and distribution system, primarily reliant on coal and managed by Eskom, has proven increasingly inadequate over the past decade. This inefficiency has led to widespread energy insecurity, with rural areas disproportionately affected. In response, the role of independent power producers has gained prominence as part of a broader national strategy to diversify the energy mix and enhance long-term energy resilience. The City of Cape Town has emerged as a leading municipal actor in addressing these challenges, adopting a decentralised energy approach grounded in the theory of public service decentralisation. This framework posits that local government initiatives – through targeted policy, investment and regulation can offer a resilient, bottom-up alternative to the failing centralised model. The City of Cape Town’s energy strategy prioritises diversification, infrastructure investment and efficiency. Key targets include sourcing 35% of the City’s energy demand from alternative sources and achieving carbon neutrality in municipal buildings by 2030. The City has secured regulatory exemptions to procure electricity directly from independent power producers and incentivise small-scale embedded generation through financial compensation for surplus energy fed into the grid. Infrastructure upgrades totalling R4 billion are underway, with plans to integrate up to one gigawatt of independent power by 2026, including solar, battery storage and waste-to-energy projects. Since 2003, the City of Cape Town has also implemented energy efficiency programmes focused on smart metering, demand side management and consumer education. While non-renewable sources remain essential for grid stability during the transition, the success of this decentralised model depends on sustained collaboration with national government, private sector stakeholders and peer municipalities. Through initiatives such as the Municipal Energy Resilience Programme, the City of Cape Town is actively mentoring smaller municipalities, reinforcing the potential of local governance to drive national energy transformation.