‘No Light at the End of the Tunnel’: Thousands of Smelter Jobs Hang by a Thread as Eskom Tariff Deadline Looms

The clock is ticking for thousands of workers in Mpumalanga’s smelting industry.

Today, 28 February, is the deadline for a long-term electricity tariff agreement between Eskom and major smelters. If no viable solution emerges, retrenchment talkstemporarily halted by short-term relief dealscan resume. And the consequences, warns trade union Solidarity, will be devastating.

The Numbers at Stake

Solidarity Deputy General Secretary Willie Venter painted a stark picture:

• Transalloys employs approximately 600 people in Witbank

• Samancor’s plants in Witbank and Middelburg employ around 1,000 people

• Glencore’s operation in Witbank employs roughly 130 people

• Columbus Steel in Middelburg has about 2,000 employees under pressure

• Ferroglobe in Witbank may be forced to cut further positions

“When you include their families, over 12,000 people in a community recently shaken by the closure of Highveld Steel could be affected,” Venter said.

The Tariff Fight

Smelters are demanding a tariff of 62c per kilowatt-hour. Last year, Eskom reached agreements with Samancor Chrome and the Glencore–Merafe Chrome Venture for short-term reliefa 12-month interim tariff of 87.74c per kWh, approved by NERSAwhile longer-term solutions were negotiated.

The Glencore–Merafe Venture restarted production at its Lion Smelter in Steelpoort under that interim tariff, but warned it was unsustainable in the long term.

Today, the long-term deadline expires. And no solution has been presented.

No Help from the Budget

Finance Minister Enoch Godongwana’s recent Budget Speech contained no interim relief for the smelters.

“The budget speech has come and gone; the deadline is almost here, and there is still no light at the end of the tunnel,” said Venter.

“All hope now rests on Eskom or the Minister of Electricity to present a solution in time to save the industry and its workers.”

The Household Comparison

While smelters demand 62c/kWh, it’s worth noting that the average South African household pays far more. Residential tariffs across the country start at over R2 per kWhmore than three times what the smelters are asking.

Eskom Group CEO Dan Marokane has pointed out that serious flaws exist in negotiated discounts for energy-intensive firms, with the costs eventually passed on to households.

The Human Cost

Venter warned of the regional impact.

“The impact of retrenchments on the Mpumalanga region, in which Witbank and Middelburg are situated, will be significant. Our concern is that large-scale unemployment awaits this area. A situation similar to the one that struck Newcastle’s steel industry awaits this community.”

The Bottom Line

Today is judgment day. Eskom and the Minister of Electricity have hours to present a solution. If they don’t, thousands of workers will face retrenchment, and 12,000 lives will be upended.

The smelters say they need 62c to survive. Eskom says discounts hurt households. And workers wait, hoping the lights don’t go out on their livelihoods.

{Source: BusinessTech}

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