Third-party electricity wheeling, explained
The delivery and financial allocation of electricity from a generator to a buyer using a third-party transmission or distribution network.
In practical terms, a generator such as a solar PV plant, wind farm, embedded generator or other IPP sells electricity to an off-taker under a Power Purchase Agreement. The generator exports electricity into the Eskom or municipal grid. The buyer consumes electricity at another connection point.
The electricity network owner then applies the agreed wheeling methodology, metering data and tariff rules to reconcile the energy and adjust the buyer's electricity account. Eskom describes third-party wheeling as a transaction where an IPP sells energy to a buyer through a PPA, with the energy exported over the Eskom grid and delivered to an off-taker elsewhere on the network.
Importantly, there is typically no direct flow of electrical energy between the IPP and the off-taker. Wheeling is an accounting and settlement mechanism layered on top of the shared, interconnected grid.
Wheeling is two things at once
A technical network access arrangement
The generator must be properly connected and metered. The network service provider must be able to calculate network charges, energy credits, losses and any administration charges.
A commercial accounting arrangement
The off-taker is contractually linked to the transaction. Exported and consumed energy is reconciled through approved agreements, compliant metering and monthly billing adjustments.
Access to the network is conditional
NERSA's 2025 regulatory rules state that rights of access to the network are subject to the network service provider's ability to connect customers in compliance with the Electricity Regulation Act, the licensee's licence, the Electricity Supply Agreement and the Connection and Use-of-System Agreement. The same rules make clear that use-of-system charges cannot be avoided through a third-party wheeling transaction.
Explore the legal & regulatory frameworkReady to go from understanding to action?
Once the concept is clear, the next question is practical: is your organisation actually ready to wheel? Work through a structured readiness check across commercial, technical, regulatory and billing dimensions.