Enerthia Energy works across four offerings — energy consultancy, business development, product and service endorsement, and funding — and one question runs through all four: what does a large user actually pay for electricity? The answer is changing. An Eskom negotiated pricing agreement, once a rarity, has now been approved three times in four months, and pricing at the top end of the South African market is being settled case by case rather than simply published.
- Three Negotiated Pricing Agreements have been approved in four months, on three different terms.
- The 62c/kWh ferrochrome tariff runs five years for Samancor Chrome and three for the Glencore-Merafe Venture.
- Manganese Metal Company’s two-year agreement bridges to a renewable PPA covering 70 percent of its consumption.
- Your costed alternative — wheeling, a PPA or own generation — is what sets the floor in any negotiation.
Prefer to listen on YouTube? The full briefing is below.
What is an Eskom negotiated pricing agreement?
It is a bespoke electricity price agreed between Eskom and a single large customer, outside the published tariff schedule, and approved by the National Energy Regulator of South Africa before it can take effect. The current wave sits inside an amended framework that lets Eskom tailor pricing and contract structure to one customer’s commercial circumstances, assessed from the bottom up on production cost, electricity intensity and commodity exposure. The regulator has been explicit that this is not a uniform discount: each agreement is judged on its own facts, and the revenue variance is ring-fenced so it cannot be recovered through later tariff mechanisms or the Regulatory Clearing Account.
Which agreements has NERSA approved?
Three, in quick succession. On 29 May 2026 the regulator approved the amended framework together with a 62c/kWh tariff for the Samancor Chrome and Glencore–Merafe Chrome ferrochrome smelters, following Eskom’s application of 10 April and public hearings on 25 May. The terms differ even within that single approval: five years for Samancor Chrome, three for the Glencore-Merafe Venture, with the core pricing mechanism and risk-sharing conditions held constant across both. Then on 30 July 2026 the regulator approved a separate two-year agreement with Manganese Metal Company in Mbombela, running from 1 August 2026 to 31 July 2028, with the tariff itself undisclosed and escalation set at producer price index plus one percent each April.
Why does the Manganese Metal Company term matter most?
Because the two-year length was chosen for a reason, and the reason is instructive. Electricity accounts for roughly 41 percent of that company’s production cost, and it draws about 360 GWh a year against a minimum consumption payment set at 80 percent of normal offtake. The agreement runs only until a renewable energy power purchase agreement it has already concluded takes over 70 percent of its consumption. In other words it negotiated a bridge rather than a destination — the same fork we set out in trader-led wheeling or a negotiated price — and it did so from a position where most of its future supply was already secured. The alternative was real, costed and contracted before the conversation started.
What should a large energy user do before negotiating?
Three things, in order. Know your load profile in detail, because that profile — baseload, load factor, seasonality — is what you are actually offering. Cost your alternatives properly before you discuss price, not after: wheeling across a municipal network, a power purchase agreement or own generation is what sets your floor, and an uncosted alternative sets no floor at all. And treat term length as a commercial position rather than an administrative detail, because a shorter term that bridges to a better supply is a different deal from a long one that locks you in. Context helps here too: Eskom’s sales to industrial customers fell 22.5 percent year on year in its 2026 financial year, so the appetite to retain viable demand is genuine.
None of this means every large user is heading for 62c/kWh. It means the number on the table is now a function of what you can credibly do instead — and that is work you do before you sit down, not during. Building and costing that position is exactly what our business development work is for.
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