Eskom has recently launched the Distribution Demand Management Programme (DDMP) to help reduce load shedding in South Africa. The programme adopts a performance contracting approach and provides an incentive for achieved demand and/or energy reduction during specified periods. The incentive rate for all DDMP performance contracting programmes is funded at a standard rate of R3 million/MW.
Enerweb is a South African company that specialises in providing market and energy trading, meter data management, utility analytics, and demand response software and services to connect buyers and sellers of electricity. Enerweb has been supporting Eskom’s Demand Side Management (DSM) and Demand Response programmes for almost two decades. The focus has been on designing, developing, and implementing advanced technologies, software and solutions that enable utilities, municipalities, traders, electricity market operators, and industrial/commercial customers to participate in maximizing the social welfare of electricity trading (i.e. affordability, reliability, transparency, fairness, fair competition, renewable integration, and environmental sustainability).
Eskom has been well-versed in managing DSM programmes since the early 2000s. Drawing on its past accomplishments, the company has incorporated them into its recently launched Distribution Demand Management Programme (DDMP). As per the prescribed DDMP rules [1], Eskom is currently accepting proposals from project developers.
The previous (and current) programmes encouraged energy efficiency and demand reduction among end users, such as residential, commercial, and industrial customers. By focussing on the demand side, Eskom targeted the management of energy consumption, stabilisation of the grid and specifically a reduction in the need for additional power generation capacity during the morning and evening peak periods. This is also the case with the recently launched programme, which uses performance contracting as a mechanism for financial settlement of the incentives.
Performance contracting is an arrangement in which the contractor (usually an energy services company, or ESCO) is paid based on the amount of energy savings achieved by implementing energy efficiency measures. This type of contract (usually) shifts the risk from the customer to the ESCO, incentivizing the latter to provide effective energy-reducing-saving solutions.
In previous Eskom DSM programmes, Enerweb was responsible for designing, implementing and operating a National Measurement and Evaluation Centre solution (i.e. the NMEC system). This solution served as a national system used by ESCOs, independent Measurement & Verification (M&V) teams (located at relevant centres of excellent at various universities and some private companies), as well as Eskom DSM stakeholders, project managers and DSM custodians. The NMEC system was a web-based platform with a back-end database that functioned as a centralised repository, ensuring a ‘single version of truth’ for all relevant information, particularly interval-based metering data sets. The database encompassed baselines and metering measurements (load profiles) of ongoing, active, and completed programmes.
It also implemented a workflow system for the formal business processes (loading, approvals, notifications, etc.) during the submission and evaluation of proposals, M&V pre-implementation activities, contracting, implementation, and completion. The previous version of this system had limited capabilities in terms of actual financial settlements of the performance contracts; however, plans are in place to address this in the future. Although the NMEC solution was terminated in 2018 due to a reduction in the number of DSM projects, its technology and significant data sets still possess immense value in supporting the industry with these types of initiatives.
The recently launched national Eskom DDMP invites project developers to submit proposals as per the prescribed DDMP rules [1]. The programmes are open to all that meet the qualification criteria, whether supplied by a municipality or Eskom, and are within the borders of South Africa. The current programmes follow a performance contracting approach, with several initiatives and is referenced in [1,2].
These initiatives include:
In the early 2000s Eskom embarked on an extensive large customer Demand Response programme (Demand Market Participation – DMP). One of the goals of the Eskom DMP programme was enhanced grid stability and reliability, for example by incentivising large customers to very quickly respond to low frequency events (within seconds). Another goal was to reduce peak electricity demand and help Eskom to avoid investing or spending in expensive peak generation capacity, defer costly infrastructure upgrades, and assist in reducing the effects and risks of blackouts and load shedding. Eskom in the process also developed capacity and experience in providing competitive electricity and ancillary market services, with the demand side effectively ‘competing’ against Generation resources.
The Eskom Transmission Demand Response team has been using Enerweb’s Demand Response Management Platform (DRPro) since 2008 to manage and operate Eskom’s Instantaneous and Supplemental Demand Response programmes [3].
DRPro provides an aggregated view of demand response load providers, and allows for effective optimisation across a demand response portfolio. DRPro covers the end-to-end demand response process flow, including load provider capturing, ancillary market bidding, scheduling and dispatching, meter data integration, advanced and automated baselining, performance reporting, and eventual financial settlement calculations.
DRPro has enabled the Eskom Transmission DR team to effectively aggregate the various load providers in its demand response portfolio and participate daily in the ancillary services market on a daily basis using different (demand response) portfolios. It is important to note that in the above, Enerweb’s role is that of a software system and daily operational service provider only. The Eskom Transmission Demand Response team makes the rules/decisions regarding contracting, bidding, scheduling, dispatching, performance reporting, and financial settlements of Load Providers, and these rules are then executed by the Enerweb (Demand Response) Operations Team on its behalf.
Utilities worldwide are increasingly using Virtual Power Plants (VPPs) and Distributed Energy Resources (DERs) to enhance grid stability, increase efficiency, and support the integration of renewable energy sources. Advanced metering and control systems coordinate these resources, which can include small-scale generation, energy storage systems, and flexible loads, to either increase or reduce their collective load in response to the needs of the local Distribution Network Control Centre or the national transmission grid operator. In many cases, VPPs and DERs are integrated through sub-aggregation platforms, which consolidate numerous small loads, such as water heaters, solar PV systems, and electric vehicle chargers. By aggregating these smaller resources, traders enable utility level system controllers to effectively manage their combined capacity and treat them as a single, flexible entity capable of responding to grid requirements.
In some regions, particularly in Europe, these aggregated resources also participate in energy markets. This allows VPPs and DERs to offer their load flexibility and generation capacity as a service to the grid, helping to balance supply and demand, reduce energy costs, and optimise the use of renewable energy sources.
Potential participation of sub-aggregators/ virtual power plants in Tx and Dx System Operations Potential participation of sub-aggregators/virtual power plants in Tx and Dx System Operations.
This article provided an overview of Eskom’s very recently launched DDMP and its role in reducing load shedding in South Africa. This new programme will leverage performance contracting and incentivise energy reduction during specified periods.
Enerweb, a South African company, has for the past 20 years offered technology and services that support Eskom’s various DSM and Demand Response initiatives.
The article also described the Eskom NMEC system, previously used as a centralized repository for DSM metering data and for managing DSM performance contracting, and the article also described Eskom Transmission’s Demand Response programme, the most recent version of which targets residential and commercial consumers, and has been included in the DDMP [4].
Lastly, the article discussed the emerging trends of Virtual Power Plants and Distributed Energy Resources in utilities worldwide. Enerweb currently has ongoing initiatives with partners and international vendors so as to assist all Southern African stakeholders to support Eskom in these new programmes, and indeed in connecting all buyers and sellers of electricity, and in so doing, maximise the social welfare of electricity trading.
© 2026 Enerweb (Pty) Ltd | All rights reserved