Eskom rolling out virtual wheeling |here’s how it works

Eskom rolling out virtual wheeling

Eskom has run a successful pilot of virtual wheeling, which will allow companies with multiple offtake sites to connect to generators using the Eskom or municipal grids.

Electricity wheeling mechanisms play a key role in facilitating the optimal integration of renewable energy resources into the grid.

Wheeling across high- and medium-voltage lines has been the focus of Eskom’s wheeling strategies to date, but the proposed introduction of virtual wheeling, a new product offering by Eskom, opens opportunities for companies with multiple smaller and low-voltage loads scattered across various geographies in South Africa to participate in the market.

What is wheeling?

Wheeling is the delivery of energy from a generator of renewable energy to an end user (the offtaker or buyer) situated in another area. This is achieved using Eskom or municipal transmission or distribution networks.

In South Africa, wheeling arrangements have traditionally been concluded between larger generators and buyers of electricity connected at medium and high voltages (higher than 1kV). Under this approach, there is a direct relationship between the generator and the buyer. Eskom charges the generator and the buyer for the use of the Eskom grid and credits the buyer’s bill for the electricity delivered to the buyer but not supplied by Eskom at the end of each month.

The traditional wheeling methodology works for larger buyers. However, it needs to be adapted for two primary reasons.The virtual wheeling platform connects buyers that have multiple offtake sites to generators…

The first is that the traditional wheeling mechanism is designed to service large consumers of electricity, typically one generator selling to one or two buyers. It does not adequately cater for several low- to medium-voltage consumers.

The second reason is that traditional wheeling has been inaccessible to buyers in most municipal distribution networks. Many municipalities lack the necessary wheeling protocols, including use-of-system tariffs, and do not have the infrastructure to accommodate the necessary billing, metering and data processing systems for wheeling transactions using both Eskom and municipal distribution networks to a buyer supplied by the municipality.

In an attempt to overcome these complexities, in July 2023 Eskom announced a new product, the virtual wheeling platform.

How will virtual wheeling work?

The virtual wheeling platform connects buyers that have multiple offtake sites to generators via Eskom or municipal grids. This requires an automated process to collect, aggregate and report time-of-use data for energy generated and consumed by generators and buyers in order to provide a refund to the buyer for wheeled energy delivered to all of its offtake sites on a consolidated basis.