Discovery Green, the energy‑wheeling arm of Discovery Limited, has inked a 10‑year Power Purchase Agreement (PPA) with hospitality giant Southern Sun. Under this deal, more than 90% of electricity consumption at seven of Southern Sun’s flagship hotels and resorts will be powered by renewable electricity sourced through wind and solar farms via the national grid.
What’s the Deal?
Signed in July 2025, the PPA covers facilities including:
- Arabella Hotel, Golf & Spa
- Drakensberg Sun
- Garden Court Morningside
- Southern Sun Katherine Street
- Southern Sun Sandton
- Champagne Sports Resort
- Sabi River Sun Resort
The electricity supplied to these properties will come from Discovery Green’s renewable portfolio, notably including Phase 2 of the 150 MW Overberg Wind Farm near Swellendam, which is being developed by independent power producer Red Rocket. Once fully operational in 2027, this wind farm will deliver more than 489 GWh of clean electricity annually.
This agreement is significant for several reasons:
- Decarbonizing hospitality: Hotels may not be the most energy-intensive sector, but shifting their power source to renewables demonstrates environmental leadership and supports consumer demand for sustainable travel.
- Grid-based wheeling in action: The renewable energy will be delivered to Southern Sun hotels via the national grid using a method called “wheeling,” allowing businesses to access clean power without installing their own generation systems.
- Blueprint for future deals: The model used here can be replicated across various industries including mining, real estate, and retail, showcasing a scalable and cost-effective method for accessing renewable energy.
Also read: Global South Demands Urgent Energy Transition as SDG Progress Stalls
Mapping the Renewable Supply Chain
| Component | Details |
| Offtaker | Discovery Green (Discovery Limited subsidiary) |
| Buyer | Southern Sun (hospitality group) |
| Scope | 7 flagship hotels, ~90% of electricity use |
| Duration | 10 years |
| Supply source | Overberg Wind Farm Phase 2 (~150 MW) |
| Annual output | ~489 GWh |
| Start of delivery | 2027 |
| Delivery mechanism | Wheeled via national grid |
Discovery Green’s Expanding Strategy
Launched in 2023, Discovery Green operates as a licensed electricity trader. Its primary function is to aggregate power from renewable independent producers and wheel that energy through the national grid to commercial and industrial consumers.
Its broader mission is to make green electricity more accessible to various sectors by offering long-term power purchase agreements with fixed prices, helping clients hedge against rising Eskom tariffs and carbon taxes.
The Southern Sun deal builds on Discovery Green’s growing portfolio of clients, including:
- Impala Platinum, where a 5-year deal will supply over 130,000 MWh annually to its Springs refineries, starting in 2026.
- KP Lime, which signed a 10-year agreement for 54,000 MWh annually to power its Northern Cape mining operations.
- Fortress, Balwin Properties, and The Capital Hotels, all of whom have long-term renewable energy contracts for their property and hospitality assets.
These zeals demonstrate the versatility of the wheeling model and show how companies can take real climate action while securing stable and affordable electricity.
Economic and Social Potential
In parallel to securing corporate energy deals, Discovery Green commissioned a white paper by sustainability consultants exploring the broader economic impact of wheeled renewables.
The study found that replacing fossil energy in non-energy-intensive sectors with 100% renewable sources would require around 16.9 GW of new solar and wind capacity and approximately 3.7 GWh of storage. The ripple effects of such a transition could include:
- Up to R308 billion in new capital investments
- Over 280,000 new jobs created across infrastructure and services
- Annual electricity savings of R15–R45 billion for businesses
- A long-term GDP uplift of approximately 0.7%
These numbers highlight that renewable energy is not only an environmental imperative but also a massive economic opportunity.
What This Means for South Africa
This deal comes at a crucial time for South Africa’s energy sector. Chronic load-shedding, rising electricity costs, and environmental degradation have forced the country to reconsider its reliance on coal-heavy generation. The private sector, including companies like Discovery Green, is now playing a vital role in the country’s energy transition.
The key implications of this PPA include:
- Accelerated clean energy adoption: Deals like this reduce dependence on Eskom’s fossil-fuel-heavy supply.
- Market transformation: Wheeling models are shifting the structure of South Africa’s electricity sector from centralized monopoly to competitive, distributed systems.
- Decentralized access: Even small and medium enterprises can now tap into clean power through these frameworks.
- Cost predictability: Long-term contracts provide price certainty in an environment of inflationary utility tariffs.
The Overberg Wind Farm
The Overberg Wind Farm, whose second phase will power the Southern Sun deal, is being constructed in phases and will provide a major clean power source once operational. Developed by Red Rocket, a prominent South African renewable energy firm, the wind farm’s 150 MW capacity will generate roughly 489 GWh annually.
It is expected to start delivering electricity by 2027. This aligns perfectly with Discovery Green’s contract start dates and helps ensure the reliability and scalability of supply for its growing client base.
The success of this wheeling model offers a blueprint for other sectors:
- Mining: Companies like Implats are already securing renewable electricity to decarbonize high-energy operations.
- Property: Real estate developers are signing multi-year contracts to power commercial buildings.
- Retail and SMEs: Long-term PPAs help manage operating costs and increase green credentials without major upfront investment.
As this trend continues, regulators may accelerate policy reform to improve grid access and increase renewable investment. This could include upgrading wheeling infrastructure, simplifying licensing for traders, and offering incentives for battery storage and embedded generation.
Also read: Africa’s Oil & Gas Industry Stands Firm Against Foreign-Backed Criticism
The Discovery Green–Southern Sun agreement represents more than a business deal, it’s a clear sign that South Africa’s energy landscape is evolving rapidly. With load-shedding still affecting millions and carbon taxes looming, forward-looking companies are recognizing the benefits of renewable energy, both financial and reputational.
By creating a bridge between clean energy producers and large-scale consumers through wheeling agreements, Discovery Green is helping reshape the future of energy in South Africa. And Southern Sun is now positioned as a leader in green hospitality, aligning with global climate goals and consumer values.
