The NERSA has approved an interim concessionary pricing framework for ferrochrome smelters under negotiated agreements with Eskom.
The decision follows regulatory hearings and an application submitted in April 2026.
Two major participants are included:
- Samancor Chrome (5-year agreement)
- Glencore–Merafe Venture (3-year agreement)
The pricing terms differ in duration, but the structure remains consistent across participants. The intent is straightforward: prevent further collapse of energy-intensive industrial demand while keeping the electricity system stable.
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Ferrochrome sits deep in South Africa’s export and mining value chain. Loss of capacity in this sector translates directly into jobs, exports, and downstream industrial activity.
Eskom framed the framework as a stabilisation mechanism. It protects industrial demand while maintaining system utilisation.
Key design features include:
- no recovery from standard tariff customers
- no taxpayer funding requirement
- structured risk-sharing between parties
- upside-sharing linked to market conditions
Dan Marokane said the agreement reflects a balance between industrial survival and utility financial stability.
The regulator’s approval signals something broader: South Africa is now actively managing industrial electricity demand as part of system stability, not just pricing policy.
By Thuita Gatero, Managing Editor, Africa Digest News.
