Energy uncertainty tightens grip on South Africa’s smelting sector

Stephen Grootes speaks to Japie Fullard, CEO Glencore Alloys, about the mounting anxiety among smelter workers as the long awaited 62c electricity deal stalls, exploring how the deadlock is deepening uncertainty in an already fragile sector and raising fresh concerns about the future of South Africa’s energy intensive industries.

Listen to the interview in the audio player below.

South Africa’s energy-intensive industries are facing renewed strain as a long-awaited electricity pricing agreement remains stuck in limbo, raising fears about jobs, investment and the future of key industrial operations.

At the centre of the concern is the proposed 62 cents per kilowatt-hour electricity deal, seen as critical to keeping smelters viable in a high-cost power environment. But with no final agreement yet in place, anxiety is growing among workers and industry leaders alike.

Smelters, which process raw minerals into metals like ferrochrome are among the most electricity-intensive operations in the economy. Power costs can account for a significant portion of total production expenses.

The proposed 62c/kWh tariff is viewed as a “lifeline price”, a level at which operations can remain sustainable, protect jobs, and continue contributing to exports.

Speaking to Stephen Grootes on The Money Show, Japie Fullard, CEO of Glencore Alloys, says the ongoing delays are creating deep uncertainty across the sector.

"We are in negotiations there with Eskom, and I can tell you we had really cordial discussions but unfortunately our time is running out."

- Japie Fullard, CEO - Glencore Alloys

"So if we make money, at Glencore, at the smelters, we are 100% willing to share that with Eskom. So there's been a lot of good discussions, but from a commercial perspective for Glencore the liability is just too big."

- Japie Fullard, CEO - Glencore Alloys

Scroll to the top of the article to listen to the full interview.