Issue 194, Dec 2025

Roundup of major energy and electricity news and developments: 24 November to 7 December 2025

1. Eskom recovery gains traction, but significant challenges and wage tensions loom.

2. Smelter shutdowns deepen as electricity prices and stalled NPAs hit heavy industry.

3. Two weeks of fast-moving wind, solar PV and grid project announcements in SA.

4. A clear signal from NERSA that electricity market reform in SA is well underway.

5. A milestone for SA: Electricity trading sector expands with 24 licences granted.

6. Private sector gas roadmap advances as SA’s national gas masterplan stalls.

7. Mozambique gas off to a shaky start amid security concerns and UK financing blow.

8. Stefanutti Stocks’ Kusile claim cut to R580m as Eskom dispute finally ends.

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1. Eskom recovery gains traction, but significant challenges and wage tensions loom.

Eskom’s turnaround gathered momentum this week as the utility reported a R24.3bn profit after tax for the first six months of FY 2026, marking one of its strongest interim performances in more than a decade. The improvement, driven by higher energy sales volumes, increased prices, stabilising plant performance and aggressive cost containment, follows years of deep losses and signals that the utility’s multi-year recovery plan is starting to show measurable results. It should be noted, however, that Eskom often reports losses in the second half of the financial year due to reduced sales revenue and increased maintenance costs in H2. In a detailed operational update, Eskom said its investment in maintenance and governance had supported a sustained reduction in unplanned outages, although diesel spending and energy availability remain under pressure, with energy availability factor (EAF) still lagging targets despite incremental gains. The financial improvement comes as S&P Global Ratings upgraded Eskom’s long-term foreign and local currency credit ratings from B- to B, citing improved liquidity, governance reforms and clearer oversight reflecting improving confidence, with government bailouts, increasing revenue and tighter cost controls beginning to reshape Eskom’s balance sheet. Eskom marked the transition to a new board of directors last week, following the end of the term of the previous board. The incoming board inherits a demanding agenda, including delivery of R112bn in cost-savings, accelerated grid investment and stabilisation of generation performance. Labour tensions, however, remain a significant risk. Unions have rejected Eskom’s 3.5% wage offer and are standing firm on a 15% demand, raising concerns over labour stability as the utility navigates its recovery path. Overall, Eskom enters 2026 on an improved financial footing – but with operational discipline and labour relations emerging as key factors for the year ahead.

2. Smelter shutdowns deepen as electricity prices and stalled NPAs hit heavy industry.

Energy-intensive industry in South Africa is entering a critical phase as escalating Eskom electricity tariffs, policy implementation delays and uncertainty in respect of negotiated pricing agreements (NPAs) continue to squeeze operations. Over the past two weeks, major producers including ArcelorMittal South Africa, Glencore-Merafe and Samancor have announced or confirmed smelter shutdowns, retrenchment proceedings and the curtailment of production across ferrochrome, ferromanganese and steel facilities. The latest blow came as Glencore-Merafe issued Section 189 notices covering thousands of workers, warning that the viability of several ferrochrome smelters has collapsed under electricity prices that have more than tripled in a decade. Merafe confirmed that as many as 3000 jobs are at risk, while unions said the cascading impact across mines, contractors and logistics may threaten several hundred thousand indirect jobs in South Africa’s metals value chain. Producers argue that they cannot absorb Eskom’s steep tariff path without relief through NPAs – a mechanism government committed to finalising in 2024, but which remains stalled, with Eskom CEO Dan Marokane now questioning the wisdom of NPAs in a recent interview with Business Day. The shutdown of Samancor furnaces, coupled with ArcelorMittal’s closure plans, is said to have already stranded close to one million tonnes of anthracite, disrupting mining operations and raising fears of widespread retrenchments across the coal and chrome belts. Business organisations and labour alike accuse government of failing to grasp the urgency of the unfolding crisis, warning that without rapid clarity on NPAs – and a stabilisation of Eskom’s tariff trajectory – South Africa risks an accelerated hollowing-out of its metals and minerals processing sector. Facing tough global competition, energy intensive industry leaders caution that South Africa is running out of time to stem further closures.

3. Two weeks of fast-moving wind, solar PV and grid project announcements in SA.

A string of announcements over the past two weeks covering South Africa’s renewable energy build-out has spanned publicly and privately procured renewable energy projects, together with enabling grid infrastructure designed, financed and constructed by the private sector. Norwegian renewable energy developer and IPP, Scatec, began commercial operation at its 273 MW Grootfontein solar PV farm in the Western Cape, now South Africa’s second-largest solar plant and the first project to reach operation under REIPPPP Bid Window 5 – a R5.1bn project with Standard Bank as lead funder. In the wind sector, renewable energy developer Anthem reported that all 96 turbine foundations have now been cast at its 420 MW Northern Cluster near Murraysburg in the Western Cape – a key construction milestone for three 140 MW wind farms that will be feeding clean energy into the grid. Mining and energy group Exxaro advanced its diversification strategy by acquiring majority stakes in the 138 MW Gouda Wind Farm and 75 MW Sishen Solar Facility, a 213 MW portfolio valued at about R1.8bn. Meanwhile, Chlorine producer NCP Chlorchem confirmed it is adding another 17.5 MW of solar PV at its Kempton Park site developed by Terra Firma, taking the on-site plant to 27 MW and making it one of the country’s largest single behind-the-meter industrial installations. On the development front, the Industrial Development Corporation (IDC) and Infrastructure South Africa requested proposals for a 100 MW solar PV feasibility study at the Coega Special Economic Zone, underlining efforts to anchor new industrial investment in clean energy. Grid readiness also received a boost as Seriti Green handed over the 400 kV Vunumoya Main Transmission Station in Mpumalanga to the National Transmission Company of South Africa (NTCSA) – an asset valued at over R1bn built to unlock additional renewable capacity in the province.​​

4. A clear signal from NERSA that electricity market reform in SA is well underway.

South Africa’s long-awaited electricity market reform took a decisive step forward las week week as the National Energy Regulator of South Africa (NERSA) announced three major developments: the finalisation of the Grid Capacity Allocation Rules (GCAR); the issuing of the Market Operator licence to the National Transmission Company South Africa (NTCSA); and the appointment of a 14-member Electricity Market Advisory Forum (EMAF). The GCAR – now formally appointed – establishes a transparent, rules-based system for allocating scarce grid capacity, replacing the earlier fragmented approach that has constrained renewable energy investments in high-yield provinces. Developers and financiers say the rules provide long-overdue predictability, particularly in the Eastern Cape, Western Cape and Northern Cape provinces where connection backlogs have stalled project pipelines valued at tens of billions of rands. In parallel, NERSA has granted NTCSA the country’s first Market Operator licence, empowering the entity to design, administer and eventually operate competitive electricity markets, including day-ahead and balancing markets. The move is widely viewed as a foundational building block for the market reform architecture underpinning the Electricity Regulation Amendment Act. NERSA also unveiled the inaugural Electricity Market Advisory Forum, comprising 14 representatives from industry, labour, municipalities, system operators, traders and consumer groups. EMAF is tasked with advising NERSA on market design, readiness criteria, implementation sequencing and the transition to a multi-buyer, multi-seller environment. While Eskom welcomed the announcement, NERSA is still requiring clarifications and undertakings from Eskom on the operational independence of NTCSA and the full independence of the Market Operator within NTCSA. Analysts note that the alignment of GCAR, NTCSA licensing and EMAF provides the clearest signal yet that South Africa is entering the execution phase of its electricity market reform programme.

5. A milestone for SA: Electricity trading sector expands with 24 licences granted.

South Africa is witnessing rapid expansion in its electricity trading environment with NERSA having issued trading licences to some 24 companies, marking the opening of a market previously dominated by Eskom. As of 7 December 2025, there are estimated to be 23 domestic electricity trading licences, three import/export trading licences, and one bulk system trading licence. This increase underpins the emerging South African Wholesale Electricity Market (SAWEM) and the transition to wholesale and retail electricity trading. The import/export trading licences to GreenCo Power Services, Enpower Trading and SOLA Group are expected to enable bilateral cross-border electricity trading, as well as trading on the Southern African Power Pool (SAPP) if the company is a member. It is known that Africa GreenCo, based in Zambia, has been a member of SAPP for some time, and last week Enpower Trading secured conditional membership of SAPP. The licensing spree comes while NERSA is finalising formal electricity trading rules. In July 2025, NERSA indicated a one-year timeline to develop trading rules by mid-2026. However, pressure by Energy & Electricity Minister Kgosientsho Ramokgopa expedited this to three months. Draft trading rules have since been published by NERSA for comment and public hearings have been scheduled for 27 January 2026. However, not everyone is convinced. Eskom and the South African Local Government Association (SALGA) have challenged the award of some licences on grounds of the absence of published trading rules, unfair competition and potential impact on municipal revenues. Nevertheless, momentum appears to be shifting – with strong regulatory backing – toward market reform. The wave of new licences and the expanding pool of traders is set to transform South Africa’s energy sector, making supply more flexible while opening new commercial opportunities for renewable energy, industrial off-takers, and domestic and regional trading.

6. Private sector gas roadmap advances as SA’s national gas masterplan stalls.

South Africa’s gas-to-power and industrial gas ambitions are facing a precarious moment. Over the past fortnight, industry and investors have announced a flurry of initiatives – even as the long-awaited national Gas Masterplan from the Department of Mineral & Petroleum Resources (DMPR) remains unfinished, and the first bid window of the Gas IPP Procurement Programme (GASIPPPP) by the IPP Office of the Department of Energy & Electricity (DEE) has been delayed. In the absence of the national Gas Masterplan, the Industrial Gas Users Association of Southern Africa (IGUA-SA) published its own long-term roadmap on 12 November 2025, warning that supply from Mozambique’s Pande-Temane fields will run dry by 2028. The roadmap argues a so-called “gas cliff” looms unless South Africa rapidly secures alternative LNG imports and invests in regional and domestic production, pipelines, terminals or storage facilities. As part of that vision, IGUA-SA facilitated establishment of a demand-aggregation vehicle, GasHub, to coordinate gas purchases and bolster negotiating power ahead of a supply crunch. At the same time, the state Public Investment Corporation (PIC) ratified an unpublished gas-strategy last week, said to be aligned with the goals of the missing Gas Masterplan and the broader Integrated Resource Plan for Electricity (IRP 2025), with gas as a bridge fuel for in South Africa’s power mix. However, uncertainties persist. The submission deadline of the first bid window of GASIPPPP has been postponed for the third time from 30 August 2024 to 29 May 2026, and its RFP amended, reflecting ongoing questions over environmental authorisations, fuel-sourcing reliability and minimum load commitments. The contrast between rising private-sector pressure and official policy inertia underscores the risk: without clearer policy direction and a finalised Gas Masterplan, South Africa’s gas-to-power ambitions may remain stuck – even as gas demand from industry and electricity generation mounts.

7. Mozambique gas off to a shaky start amid security concerns and UK financing blow.

Momentum is building around Mozambique’s gas sector despite a significant setback this week after the UK government withdrew £900m (R20bn) in financing for TotalEnergies’ giant Mozambique LNG project in Cabo Delgado. The withdrawal, driven by revised assessments of environmental and social safeguards, temporarily clouds the financial picture for one of Africa’s largest LNG developments. TotalEnergies said it remained committed to the project and was engaging alternative financiers as security conditions continue, but has indicated a US $4.5bn (R76bn) upward revision of the project’s capital costs and an increase in the delivered gas prices. Meanwhile, the Mozambican government gave TotalEnergies a 30-day deadline to provide a firm timeline for restarting construction, arguing that delays are constraining economic recovery and investor confidence in Cabo Delgado. However, investor sentiment in northern Mozambique is said to be improving following earlier indications that work could resume in 2026. Local media report an influx of entrepreneurs and suppliers returning to Palma and Afungi, signalling some optimism in the region’s economic recovery as humanitarian and military support operations take hold. In a parallel development, Mozambique has approved a dual-FSRU (floating storage and regasification unit) project aimed at supplying gas to both domestic users and South Africa. The project, backed by regional investors, is expected to create a flexible LNG import and regasification corridor capable of supporting power generation, industrial off-takers and cross-border trading. During a bi-national commission meeting in Maputo, President Cyril Ramaphosa announced progress on a proposed Mozambique-South Africa gas facility, aimed at securing new supply routes as South Africa confronts its looming gas-supply cliff. The initiative forms part of a broader cooperation package including transmission interconnection, border security and trade facilitation. 

8. Stefanutti Stocks’ Kusile claim cut to R580m as Eskom dispute finally ends.

Eskom and Stefanutti Stocks have formally ended their long-running contractual dispute relating to the construction of the Kusile Power Station, by concluding a R580m settlement that brings closure to one of the most protracted claims associated with the project. The contractor’s original R1.6bn claim for outstanding payments, variations and delays was scaled back following months of negotiation and independent assessment. The announcement comes shortly after the last 800 MW Kusile generating unit was finally commissioned, marking the practical completion of the power station almost two decades after construction began. Eskom described the settlement as a “fair and final resolution” that removes a major contractual overhang and allows the utility to focus on operational stability and long-term maintenance planning at Kusile. For Stefanutti Stocks, the resolution eliminates a substantial legacy item from its balance sheet at a time when the group is beginning to rebuild momentum. The company recently reported improved interim results and a notably strengthened order book of R13.4bn – reflecting growing demand across transport, energy and industrial infrastructure markets. Industry analysts say the settlement is significant not only for its financial finality but also for what it signals about Eskom’s shifting posture. With outstanding contactor claims at Medupi, Kusile and other capital projects estimated at about R6bn, the utility appears intent on stabilising relationships with contractors and ensuring clearer project governance across future builds and refurbishment programmes. While questions remain about why the claim was ultimately reduced so sharply, the agreement allows both sides to move on. It also symbolically closes a difficult chapter in South Africa’s fleet-expansion history, coinciding with the first period of sustained operational improvement at Eskom in several years.

Independent Energy Pool (IEP Global)

Independent Energy Pool (IEP Global) is a business-to-business energy pool, allowing energy users and energy traders to buy and sell electricity. IEP's ecosystem allows transacting of electricity in a balanced and standardised environment. The pool incorporates the ability to trade renewable energy certificates, as well as the tracking and reporting of ESG criteria.

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