• Cape Town will tender an electricity trader mid-Feb 2026 to aggregate multiple producers and unlock ~300 MW of independent power.

• 2026 water PPPs: Paarden Eiland desalination ≈70 ML/day and Faure potable reuse ≈100 ML/day, targeting operation by 2030.

• Reduce Eskom reliance, steady tariffs, and boost resilience for a growing city and tourism hub (11.1m CTIA passengers in 2025).

The City of Cape Town, located on the western coast of South Africa, is reportedly preparing to issue a tender in mid-February 2026 to appoint an electricity trader, a move intended to shift the municipality from one-to-one power purchase negotiations toward a market model that aggregates supply from multiple independent producers. The initiative, according to local media reporting on the fact, is designed to diversify the city’s energy mix, reduce exposure to national grid fragility, and moderate tariff volatility that has built up over the past two decades.

On the water side, Cape Town plans competitive procurements in 2026 for two major Public-Private Partnerships (PPPs): a seawater desalination facility at Paarden Eiland with an indicative capacity of about 70 million litres per day, and a potable water reuse project at the Faure New Water Scheme targeting roughly 100 million litres per day. Both projects are being advanced with an in-service objective of 2030, aligning with the city’s broader “New Water” program to secure supplies for a growing metropolitan population and economy.

The electricity tender aims to unlock up to 300 MW of independent capacity already under pursuit since 2022, with a trader expected to contract flexibly across multiple generators and technologies. This approach is intended to improve reliability and price discovery while accelerating procurement timelines. Its success will depend on the availability of transmission capacity, the pace of grid connections, and how curtailment is managed in the Western Cape.

The planned water PPPs are structured to shift a portion of upfront capital investment and construction risk to private partners, with long-term offtake agreements providing revenue certainty. Desalination is energy-intensive, and the city has indicated the need to evaluate indexation and pass-through mechanisms carefully so that early-year tariff impacts are predictable and transparent for households and businesses. For potable reuse, the focus is on proven treatment standards and operational performance guarantees that protect public health while adding drought-resilient supply.

Officials frame these measures as part of a resilience agenda that supports Cape Town’s role as a services and tourism hub. The city recorded an estimated 11.1 million passengers at Cape Town International Airport in 2025, a reminder that dependable power and water are critical to sustaining investment, jobs, and visitor growth. At the same time, national indicators—such as Eskom’s Energy Availability Factor trending in the mid-50s in recent years with tentative improvement—underscore the rationale for municipal diversification.

Key details for publication, including the tender reference number, scope, evaluation criteria, and award timeline for the electricity trader, will be confirmed when the notice is issued. For the water PPPs, the city is expected to publish technical and financial parameters covering intake and discharge design for desalination, reuse treatment trains, environmental safeguards, and risk-sharing provisions across construction, availability, and performance.

Together, the electricity trading tender and the water PPP pipeline mark a pivot toward a more decentralized, contract-driven model of municipal infrastructure delivery. If executed as planned, Cape Town would enter the next decade with a larger portfolio of independent clean-energy supply and two major drought-resilient water assets, while establishing a clearer framework for private capital participation in core urban services.

Cynthia Ebot Takang