Sustainable business model innovation for South African municipalities in a changing South African energy landscape

Abstract

South African municipalities are at a crossroads regarding the relevance of their electricity business models, driven primarily by financial unsustainability, regulatory loopholes, and technological advancements. This study explores the options available to these municipalities for a seamless transition to a more decentralised energy model. A qualitative approach was employed, collecting data through in-depth interviews with public and private stakeholders. The findings highlighted significant barriers, such as declining revenue from locally generated electricity, insufficient regulatory support, and limited investment in information and communication technologies. The study outlined various adaptive measures, including Energy-as-a-Service (EaaS), innovative pricing structures, and initiatives supported by Public-Private Partnerships (PPPs). Successful adoption of relevant energy infrastructure necessitates collaboration among a diverse group of stakeholders, including Independent Power Producers (IPPs) and consumer prosumers. The insights gained from this research are crucial for policymakers, local government authorities, and industry stakeholders engaged in developing robust and economically viable electricity business models. Without essential structural reforms and investments in advanced technologies, municipal electricity departments in South Africa risk losing sustainability. This research contributes to the academic discourse on municipal energy sustainability, regulatory reforms, and new business models within the context of South Africa's evolving energy landscape.