Blu Label Limitless Group is constructing what it describes as an “built-in power ecosystem” that spans good meter roll-outs, municipal income restoration and small-scale energy era — a technique it believes no different South African firm can replicate.
Talking to journalists after the discharge of its interim outcomes on Wednesday, co-CEO Mark Levy outlined a three-pronged power technique anchored within the group’s Cigicell subsidiary and the newly created BluEnergy Buying and selling unit.
The plan leverages Blu Label’s decades-old contractual relationships with municipalities and its present function because the nation’s dominant distributor of pay as you go electrical energy tokens — a enterprise that now processes R3-billion to R4-billion/month in transactions.
On the centre of the technique is what Blu Label calls “income assurance” — a programme it says was conceived and designed internally.
The idea is constructed round the truth that municipalities are shopping for electrical energy appropriately from Eskom however failing to gather what they promote. Blu Label estimates that about 30% of electrical energy distributed by municipalities is misplaced, stolen or in any other case unaccounted for. Throughout the business, this represents tens of billions of rands in lacking income.
“When you equate that throughout the business numbers, you discuss tens of billions of rands,” stated Levy. “You take a look at the loss in money stream, you take a look at the loss in earnings for municipalities, you take a look at the loss in money stream for presidency, for Eskom, you take a look at the loss at Sars from a VAT viewpoint — we discuss billions and billions of rands.”
Income-assurance agreements
The programme works on an at-risk mannequin. Blu Label and the municipality agree on a baseline of present collections. If Blu Label’s crew can’t enhance on that baseline, it doesn’t receives a commission. The place it does discover unbilled or incorrectly billed consumption, it retains an agreed share of what it recovers — much like a debt restoration association.
The method includes deploying floor groups to go to properties, geo-code every location, exchange meters the place obligatory, tag meters to the proper buyer accounts, confirm that the proper tariff is being utilized and reconstruct billing histories. Below prevailing laws, municipalities can get well arrears going again as much as 36 months.
The main target is initially on giant energy customers, which generally account for about 65% of a municipality’s electrical energy consumption.
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Levy offered an illustrative instance for one municipality displaying that, by recovering simply 40% of the lacking income over a 10-year interval, the municipality would accumulate a further R19-billion in income.
Blu Label has signed two revenue-assurance agreements: a 10-year contract with the Metropolis of Ekurhuleni and a three-year contract with the Metropolis of Tshwane. A number of others are within the pipeline, the corporate stated.
In parallel, Cigicell has secured considered one of a number of RT29 transversal contracts — a pre-approved authorities procurement mechanism — for the roll-out of good meters. Levy stated Cigicell was, in follow, the one recipient among the many 9 that operates immediately within the pay as you go electrical energy distribution area, and that the corporate has already deployed tens of hundreds of meters beneath these contracts.
The good meter roll-out feeds immediately into the revenue-assurance programme: changing outdated or tampered meters is a obligatory first step, however with out additionally correcting billing data and tariff classifications, it solves solely a part of the issue.
The third leg of the technique is BluEnergy, a unit designed to construct and function small-scale photo voltaic and battery vegetation that feed electrical energy immediately into municipal substations, or nodes.
Somewhat than competing with giant unbiased energy producers constructing vegetation of a whole bunch of megawatts, BluEnergy plans to construct amenities of 10-40MW at particular person substations. Levy argued the method provides important benefits in pace and threat diversification.
“If somebody needs to construct a 200MW plant, it could most likely take 4 or 5 years to construct and price R4-billion to R5-billion,” he stated. “If we roll out on the nodal mannequin — 200MW throughout 10 or 20 nodes — we may very well be up inside 15 months. And we’d don’t have any focus threat.”
The mannequin requires a power-purchase settlement with the related municipality, land inside about 5 kilometres of the substation, an evaluation of the substation’s long-term viability, and — critically — money stream safety to fund the initiatives.
Photo voltaic, batteries
That is the place Blu Label’s present municipal relationships develop into the enabler. As a result of Cigicell already collects electrical energy funds on behalf of municipalities, it might supply banks and funders visibility into predictable money flows, permitting it to ascertain escrow accounts and safe mission finance.
“There are many funds on the market taking a look at infrastructure funding,” stated Levy. “All of the banks have come to us due to the money stream safety.”
Co-CEO Brett Levy added that the capital for BluEnergy initiatives would come from infrastructure lenders and inexperienced power funds fairly than from Blu Label’s personal steadiness sheet.
Learn: Blu Label takes R5.2-billion Cell C hit, touts clear slate forward
One novel factor of the design includes constructing paired photo voltaic vegetation — one producing throughout daylight whereas the opposite fees batteries. When the solar goes down, the batteries discharge, offering a relentless output.
The ultimate piece is the power buying and selling licence lately awarded to BluEnergy by power regulator Nersa. Blu Label described the licence — which took years to acquire — as a significant milestone that enables the group to behave as an power off-taker: shopping for, promoting and buying and selling power, whether or not self-generated or procured from third events.
The licence opens the door to buying and selling power to municipalities and huge energy customers, additional extending Blu Label’s attain throughout the electrical energy worth chain.
The technique is, partially, a response to years of margin compression in Blu Label’s conventional pay as you go electrical energy enterprise. Though electrical energy income generated on behalf of municipalities grew 11% to R24.3-billion within the six months to end-November 2025, commissions earned by Cigicell fell 10% to R144-million as municipalities squeezed the distribution margin.
“You began getting important margin compression, the place the municipalities would cut back their margin to the distribution channel,” stated Levy. “Your turnover would improve, however your share earn — as a result of we receives a commission on kilowatt-hours, not turnover — began to lower.”
Learn: Blu Label lands electrical energy buying and selling licence from Nersa
The power ecosystem technique is Blu Label’s reply: fairly than merely distributing tokens, it goals to develop into an indispensable associate to cash-strapped municipalities by serving to them get well misplaced income, modernise their metering infrastructure, and safe cheaper, cleaner power provide. – © 2026 NewsCentral Media
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