Johannesburg — June 1, 2026 — South Africa’s energy regulator NERSA has approved a preferential electricity tariff of $0.03 per kilowatt‑hour for two major ferrochrome producers, Samancor Chrome and the Glencore‑Merafe joint venture, in a bid to preserve industrial capacity and jobs amid soaring power costs.
Ferrochrome, a critical alloy used in stainless steel production, has been at the heart of South Africa’s industrial supply chain. However, electricity prices have risen by more than 900% since 2008, eroding the competitiveness of local smelters and leading to widespread closures and job losses.
The new tariff agreements will run for five years for Samancor and three years for Glencore‑Merafe, aiming to prevent further shutdowns and safeguard specialized metallurgical skills. Smelters are among Eskom’s largest electricity consumers, and keeping them operational also helps stabilize industrial demand and strengthen the utility’s financial position.
Authorities stressed that the measure will not raise costs for households or businesses. Eskom confirmed that revenue foregone under the reduced tariff cannot be recovered through standard mechanisms. A profit‑sharing clause will activate if market conditions improve, ensuring balanced benefits.
The decision contrasts with challenges in neighboring Mozambique, where the absence of competitive tariffs led South32 to announce the suspension of the Mozal aluminium smelter. South Africa’s move highlights the importance of affordable energy in sustaining power‑intensive industries and maintaining global competitiveness.
