COLLECTIVE WELLBEING: Renewable energy was promised as a path to prosperity — what happened?

South Africa’s Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) is widely presented by government and private finance as evidence that private investment can deliver infrastructure at scale.

Since its launch in 2011, the programme has attracted billions of rands in private capital and enabled the rapid development of large wind and solar projects. National Treasury describes REIPPPP as a “successful experience” and proposes extending elements of its model to other infrastructure sectors.

Standard Bank points to more than 12,000 MW of closed deals as evidence of successful private capital deployment, while Nedbank cites R40-billion funded across 42 REIPPPP transactions as proof of its role in the programme’s success. 

This model has deep roots in South Africa’s energy policy. The 1998 White Paper on Energy Policy called for greater competition and private participation in electricity generation, while questioning the efficiency of Eskom’s state monopoly. Nearly three decades later, the market-oriented approach is deeply embedded in the country’s electricity sector.

By the measures of private capital mobilised and megawatts procured, REIPPPP is a success. But these measures tell only part of the story. The programme also came with expectations of jobs, local economic development, community benefits, affordable electricity and broader prosperity. These promises matter most in the towns and rural areas that host renewable energy projects.

Poverty, unemployment linger

Fifteen years on, the turbines are turning. What happens when we judge REIPPPP against these broader expectations, and against the wellbeing of the people who live alongside it?

We have spent years conducting fieldwork in towns like these in the Northern and Eastern Cape. These towns lie beside some of the country’s largest wind and solar farms. Yet unemployment and poverty remain high, and local municipalities struggle to provide basic services. 

In Sutherland, 97% of households have access to electricity, yet only 10.6% have electric geysers. Most residents heat water with a kettle, and firewood, gas and paraffin remain important for heating homes because electricity is too expensive.

Meanwhile, electricity generated in the surrounding area is fed into the national grid. The REIPPPP reproduced a centralised model of generation and distribution. It left little space for more affordable community generation and local ownership or other arrangements that might connect generation more directly to local energy needs.

Employment tells a similar story. The IPP Office reported 104,209 job years created under the REIPPPP by March 2026. This figure does not represent 104,209 permanent jobs: a job year is equivalent to one person employed full-time for one year. Moreover, employment is concentrated during the construction phase and declines substantially once projects enter operation.

As one De Aar resident explained, “People want permanent work… things are good for three or four months, and then it’s bad again.”

What remains are smaller interventions by the Independent Power Producers (IPPs), such as school upgrades, bursaries and one-off donations. These matter to those who receive them. They cannot address the poverty, unemployment and weak municipal capacity that existed before the turbines arrived.

Socioeconomic development withers

We are not dismissing the value of renewable energy. Our critique is of the corporate, market-focused framework through which it is implemented. The state designed REIPPPP to channel decarbonisation through competitive tenders, private investment and shareholder profits, and to assess success by price, capacity and capital raised. Within this framework, socioeconomic development is not a primary goal. It is a compliance layer added to an investment structure built for capital accumulation.

This design has a long history. Like many developing countries, South Africa has adopted austerity, reducing public spending to control debt, believing business confidence will rise once the government stops crowding out private investment. David Harvey warned that cutting expenditure and privatising social services can harm marginalised communities and workers. David McDonald describes how energy privatisation in South Africa involved selling state assets, establishing independent power producers, privatising and outsourcing services and planning future divestitures.

Pricing reforms such as tariff adjustments, user fees and disconnections for non-payment made electricity less affordable and less accessible for many South Africans. After 1994, the government planned to “unbundle” Eskom and sell 30% of its generation capacity to ease fiscal strain, until trade unions halted the plan. Given the government’s commitment to austerity, IPPs are unlikely to reverse hardships they were never intended to solve.

The model’s limits

This is where the REIPPPP model reaches its limits. Secure livelihoods require diverse local economies. Education and health depend on functioning schools, universities and healthcare systems. Democratic participation depends on accountable governance. Ecological wellbeing depends on restoring biodiverse ecosystems at landscape scale rather than isolated mitigation.

These outcomes depend on functioning institutions and sustained public investment. They cannot simply be purchased into existence by private developers.  

A wind farm on communal land in the Eastern Cape shows these limits.

Unlike most REIPPPP projects, which sit on private, white-owned farmland, the Tsitsikamma Community Wind Farm is built on reclaimed communal land, with real community shares, community participation and the support of a philanthropic corporation. Yet the community’s material conditions remain unchanged, as do relations to the land and soil, which remain extractive. If land ownership and shareholding were the key factors, this project should differ significantly from others. It does not.

South Africa’s transition to renewable energy is occurring within a deeply unequal socioecological setting shaped by colonial land dispossession, apartheid spatial planning and more than a century of mineral extraction. The technology has changed, but the pattern has not: value is still taken from rural places and flows elsewhere.

This is not simply the outcome of market forces. It reflects the state’s choice to rely on private capital while restricting public spending. The current approach risks reproducing these inequities, continuing to marginalise historically disadvantaged communities and condemning them to uncertain and undignified futures.

The real challenge — collective wellbeing

Private developers can build and operate large-scale generation, which South Africa requires. The real challenge isn’t just attracting additional private investments or ensuring community benefits are strictly enforced.

Instead, it’s about establishing the right conditions for a transition focused on collective wellbeing. This requires a visible and accountable state presence in host communities: functioning municipalities, reliable public services and infrastructure and institutions that can respond to local needs. It also requires political choices about where public resources go and how economic value is redistributed.

Equally important is broadening who can generate, own and benefit from electricity, through public-public partnerships between municipalities and provincial utilities, community-organised generation, cooperatives and other locally rooted models. Such approaches can strengthen local economies without making private investment the main mechanism for social improvement and redistribution.

No procurement model can substitute for a functioning state, sustained public investment and meaningful redistribution. The question is not how to make private investment do more, but how renewable energy can be organised to serve local economies and collective wellbeing. DM

Stephanie Borchardt is a postdoctoral fellow in the DSTI-NRF-SARChI Chair in the Sociology of Land, Environment and Sustainable Development, Department of Sociology and Anthropology at Stellenbosch University. Michelle Pressend is a postdoctoral fellow in the NRF-SARChI Chair in Sustainable Rural Futures, Department of Sociology at Rhodes University.