South Africa intends launching a pilot programme for the procurement of 1 164 km of 400-kV powerlines, involving seven corridors in three provinces, in November as part of an initiative to mobilise private investment to address a grid backlog that is currently constraining new projects in high potential renewable-energy regions.

The pilot independent transmission project (ITP) request for proposals will be overseen by the Independent Power Producer Office (IPPO), which has managed South Africa's public renewables procurement since 2011, and will be preceeded by the release of a request for qualification in July.

On March 28, Electricity and Energy Minister Dr Kgosientsho Ramokgopa Gazetted a Ministerial Determination under Section 34 of the Electricity Regulation Act opening the way for the procurement of ITP capacity in the Northern Cape, the North West province and Gauteng.

The determination designates the Department of Electricity and Energy (DEE) as the procurer and the National Transmission Company South Africa (NTCSA), the Eskom subsidiary of responsible for the grid and system and market operations, as the buyer of the ITP capacity over the concession period.

Neither the precise ITP model, nor the concession term, has been disclosed, but Ramokgopa indicated during a briefing on April 1 that some form of build, operate, own and transfer, or BOOT, arrangement was likely to be implemented.

He also reported that the regulations required for advancing the ITP programme would be published on April 3, presumably for public comment.

The initial seven corridors had been selected from within the NTCSA's Transmission Development Plan project pipeline, which envisages the roll-out of some 14 000 km of new powerlines and associated grid infrastructure over the coming ten years.

ADVANCED PROJECTS SELECTED

Ramokgopa said that only "late-stage" projects had been chosen for the pilot so as not to burden ITP investors with the often-difficult task of securing the servitudes and finalising the environmental-impact assessments needed for transmission infrastructure.

Besides 1 164 km of powerlines, 2 630 MVA of transformation capacity will be procured across the following corridors: Aries-Aggeneis, Groeipunt and Boundary-Ferrum, in the Northern Cape; Mookodi-Hermes and Mahikeng Integration Phase 1, in the North West; and Hera-Westgate, in Gauteng.

Once completed in 2029, the pilot ITPs would unlock grid capacity for a further 3 200 MW of new solar and wind capacity.

The DEE's Shaakira Karolia reported that a reverse-bidding auction was envisaged, whereby the lowest-cost bidders would be selected to build the initial projects and recover their capital, operations and maintenance costs, as well as earn a reasonable return over the concession period.

These costs would be recovered through the regulated tariff, possibly using the Regulatory Clearing Account mechanism.

While government had studied hundreds of similar concessions in countries such as Brazil, Chile, Peru and India, a multidisciplinary team, involving government officials and National Energy Regulator of South Africa members, had been established to ensure that all of the regulatory components were in place ahead of the pilot.

Ramokgopa stressed that the grid infrastructure built by the ITPs would be additional to the capital expenditure under way at the NTCSA and were being pursued largely because neither the NTCSA nor government had the financial resources in hand to address the prevailing grid backlog.

Describing it as a "step change", the Minister said the ITP programme was one of the mechanisms that the Government of National Unity aimed to use to place South Africa on a higher growth trajectory by addressing the electricity constraint to economic activity.

He also expressed confidence in the ability of the IPPO to oversee the pilot procurement, despite the fact that it was currently seeking a replacement for its previous head, Bernard Magoro, whose contract had expired.

An...

JSE-listed steel group ArcelorMittal South Africa (AMSA) has deferred the wind down of its long-steel business for at least six months to August 31, after the State-owned Industrial Development Corporation (IDC) provided another R1.68-billion in funding support.

The Newcastle works blast furnace, in KwaZulu-Natal, which was initially scheduled to be closed at the end of February, remained operating until the end of March after the IDC extended a R380-million loan.

The latest deferral in the mill's wind down meant that retrenchment consultations initiated under Section 189(3) of the Labour Relations Act had also been be suspended, but AMSA said certain areas outside the longs business might still undergo "restructuring" for operational reasons.

The company has also received a Temporary Employee Relief Scheme grant to assist in funding employee costs, which will reduce the draw down required against the IDC facility.

In a statement, AMSA said the IDC facility was repayable subject to agreement between the parties and contingent on the financial performance, solvency and liquidity of the longs unit.

As part of the agreement, the IDC may also conduct a due diligence exercise into possible alternative solutions for the business, but no details were provided as to what solutions might be considered.

"The South African government will utilise the deferral period to expeditiously address structural problems for the industry, including the scrap Preferential Pricing System (PPS), scrap export tax, and tariff measures including safeguards," CEO Kobus Verster said in a statement.

The group said it anticipated imminent changes to the PPS and export tax, along with new protection.

"These measures will help level the playing field in the steel industry to the benefit of the country," Verster stated, while noting emerging signs of demand growth in the South African economy.

"The IDC facility, combined with the government's commitment to address structural challenges in the industry, offers a pathway to potential long-term sustainability for the business," he added.

The next six months would be crucial in determining whether the longs business could achieve the "financial stability required for long-term viability".

Forestry, Fisheries and the Environment Minister Dr Dion George has granted Eskom air-pollution exemptions for eight power stations that would otherwise have been forced to close on April 1. He insists, however, that the exemptions do not represent a "blanket reprieve" and that they have been granted together with "rigorous conditions".

On December 10, Eskom applied for relief from the minimum emission standards (MES) for eight of its coal-fired power stations, namely Duvha, Kendal, Lethabo, Majuba, Matimba, Matla, Medupi, and Tutuka.

The applications were made in line with Section 59 of the National Environmental Management: Air Quality Act, 2004, and followed the granting last year by George's predecessor, Barbara Creecy, of permission allowing Eskom to continue to operate the aged Hendrina, Grootvlei, Arnot, Camden and Kriel at existing MES plant limits until their decommissioning on March 31, 2030.

The decision of both Ministers followed an intense period of electricity insecurity, with loadshedding, which has been a persistent threat since 2007, having intensified to the point where it was being implemented almost daily in 2023.

There have also been bouts of rotational power cuts in the early months of 2025, despite a material waning of loadshedding on the back of coal plant improvements following a big taxpayer funded debt-relief programme at Eskom, as well as significant private investment in solar PV and batteries, which has helped reduce demand and create space for much-needed maintenance.

On March 31, George announced his MES decision, which he said sought to balance the imperatives of energy security, economic stability, and environmental protection.

During a briefing in Cape Town, he announced that two of the stations (Duvha and Matla) had been granted exemptions until their decommissioning date in 2034.

The other six, were granted five-year exemptions until April 1, 2030, during which time actions would need to be taken to mitigate their pollution and to prepare the stations to operate legally thereafter.

KEY CONDITIONS

Some of the near-term mitigation actions ordered, included:

The deployment of air quality monitoring stations and a data-free alert App within eight months;

The appointment of an environmental health specialist within three months, and the extension of health-screening programmes within six months in affected communities, alongside mobile clinics and greenspace initiatives;

The expansion of interventions to 96 000 households within 12 months, while addressing waste and ash dumps near power stations;

The immediate publication of real-time emissions data, with additional monitoring stations to be installed within 12 months;

The completion of a revised cost-benefit analysis within six months regarding Medupi's delayed flue gas desulphurisation (FGD) retrofit; and

The publication by the end of March yearly of a detail report on what progress Eskom was making to integrate renewable energy into the grid.

George even went so far as to suggest specific energy policies that he said required priority if South Africa were to transition to a point where there would be security of supply, while also meeting the obligation outlined in Section 24 of the Constitution guaranteeing a right to an environment that is not harmful to health and well-being.

Some of his recommendations included transitioning the Independent Power Producer Office into an independent Transmission System Operator to streamline procurement; accelerating transmission infrastructure under the National Transmission Company South Africa to facilitate seamless grid integration of renewable projects; and the establishment of a competitive power market by April 1, 2026.

WHAT HAS BEEN GRANTED?

Meanwhile George also outlined the following specific decision for each of the affected coal-fired power stations:

An MES exemption for the Duvha power station until its planned decommissioning date of February 21, 2034, alongside conditions for mitigating t...

BMW Group South Africa (SA) says it cannot over-emphasise the importance of policies such as the African Growth and Opportunity Act (Agoa) for the continued success of the German car maker's business in the country.

"These policies enable us, as a relatively small global industrial player - this relationship is crucial for our ability to continue manufacturing vehicles and providing jobs in South Africa," warns a BMW SA spokesperson.

South Africa benefits from duty-free access to the US under Agoa.

However, this preferential market access may be under threat following an announcement by President Donald Trump last week that the US will impose a 25% tariff on vehicles and certain vehicle parts imported into the US.

It is not yet clear whether this tariff will be applicable to Agoa beneficiaries.

naamsa | The Automotive Business Council said last week that it was "actively assessing" the potential impact of the 25% tariff on the domestic automotive industry.

"We are currently engaging with our members and other key stakeholders, including government authorities and trade partners, to determine whether Agoa preferences remain unaffected by the latest proclamation."

"We are evaluating the announcements in detail," adds the BMW SA spokesperson.

BMW SA exports the X3 sports-activity vehicle to the US, among other markets, from its Rosslyn assembly plant in Tshwane.

"Free trade and international cooperation are of immense importance worldwide and are essential drivers of growth and progress," notes the BMW SA spokesperson.

"They have always been a guiding principle of the BMW Group.

"Tariffs, on the other hand, hinder free trade, slow down innovation and set a negative spiral in motion. In the end, they are detrimental to customers, making products more expensive and less innovative.

"That is why we should generally always be talking about fewer trade barriers rather than more."

A leading trade adviser is urging companies and individuals with interests in South Africa's steel value chain to respond to the International Trade Administration Commission's (Itac's) call for comment on its wide-ranging review of the steel tariff structure, warning that a failure to do so would limit their chances of challenging the outcome.

Itac published details of the much-anticipated review in a March 19 Government Gazette notice and provided a four-week comment period, implying a deadline of April 16.

The review covers the tariffs on steel and stainless steel products included in chapters 72, 73, 82 and 83 of the Customs and Excise Act, which XA Global Trade Advisors MD Donald MacKay says involves 609 tariff codes that govern R67-billion of yearly imports.

Chapter 72, for instance, deals with primary carbon and stainless products such as hot-rolled coil, chapter 73 with steel articles such as wire and pipes, chapter 82 with tools and cutlery, and chapter 83 with miscellaneous steel products, including such items as padlocks.

Besides assessing existing protection measures and rebates, as well as ways to tackle ongoing customs fraud, the review will consider the addition or removal of rebates, along with new or higher tariffs, additional import controls, and even the introduction of minimum reference pricing on certain products.

The scope has also been widened to include an assessment of measures to lower the cost of raw materials, including iron-ore, coking coal and scrap, with the price and movement of scrap already regulated by a price preference system and an export tax.

This has resulted in significant discounts for scrap-based steelmakers, which ArcelorMittal South Africa (AMSA) has highlighted as one of the major reasons behind its decision to wind down the Newcastle mill, which produces steel from iron-ore and coking coal, as well as its associated long-steel units in Mpumalanga and Gauteng.

MacKay describes the scope of the review as unprecedented and cautions that the interventions that may arise could have material implications, particularly should new import restrictions be imposed.

"I think the scope of this review is so big that there will be collateral damage," he says, indicating that there is still uncertainty whether government could, following the review, impose tariffs at the World Trade Organisation (WTO) bound rate, or even beyond.

The bound rate is the maximum tariff a WTO-member country can implement on imports, but countries can impose higher tariffs on an emergency basis, by using Article 19 of the General Agreement on Tariffs and Trade.

Trade, Industry and Competition Minister Parks Tau has requested feedback from Itac on the review by the end of June.

Given the scale of the investigation, however, MacKay is not convinced it will be completed by then, noting that previous reviews covering only a handful of tariff codes have typically taken 27 months to complete.

That said, he highlights the political pressure on Itac to move with speed, particularly given moves to salvage AMSA's longs operations, and trade policy developments internationally, particularly in the US.

"If you don't respond and you find yourself with your tariff at the WTO bound rate, you are not going to be able to legally challenge that, if you have done nothing."

Engineering News editor Terence Creamer discusses the significance of a pre-procurement exercise that is under way to test market appetite for private sector participation projects on key commodity and general freight corridors.

The African Rail Industry Association (ARIA) has welcomed the launch of a pre-procurement market sounding exercise by the South African government with regard to private sector participation (PSP) prospects on key commodity and general freight corridors, arguing that the consultation should improve prospects for attracting much-needed investment into the rail network and train operations.

However, outgoing chairperson James Holley has also called for immediate attention to be given to prevailing impediments to the introduction of third-party train operating companies (TOCs); especially the poor state of network and signalling infrastructure, which was creating uncertainty about what service level commitments could feasibly be made by new private operators.

Speaking during ARIA's AGM, Holley described the recent release by Transport Minister Barbara Creecy of a request for information (RFI) for PSP prospects on key freight corridors as a welcome departure from past practice, where projects had been "scoped in a vacuum and presented on a take-it-or-leave-it basis".

Creecy, who also participated in the meeting, launched the RFI on March 23, to test market-appetite for the following:

PSP prospects on the Northern Cape-to-Saldanha and the Northern Cape-to-Nelson Mandela Bay corridors, which primarily transport iron-ore and manganese exports respectively;

a Richards Bay Bulk Minerals Corridor PSP, which is a key export channel for coal and chrome and magnetite from Limpopo and Mpumalanga; and

an intermodal supply-chain PSP project focused on the container and automotive sectors, including the potential designation of the South African container port system as a regional transhipment hub for major shipping lines.

A closing date of May 9 has been set, and Creecy has promised that submissions will be treated with strict confidentiality and that the information will be used to guide the design of request for proposal (RFP) documentation, to be released into the market by the end of August.

These procurement processes will be overseen by a new PSP Unit, housed in the Development Bank of Southern Africa, and modelled partly on the Independent Power Producer Office, which has overseen the public procurement of renewable-energy capacity and which will also manage the pilot independent transmission project procurement scheduled for later this year.

Holley said the RFI made sense, as it would allow the industry to help sculpt the RFPs such that there would be interest from bidders, arguing that a significant rise in investment in rail would be the true mark of success for the reforms under way in the sector.

ARIA estimated that some R200-billion in investment was required to return the country's economically viable rail system to design conditions.

"As the private sector we must now respond with robust feedback," Holley averred, adding that the industry would lose its right to criticise should it fail to engage with the RFI.

PSP STRATEGY & 250MT TARGET

Creecy said the reforms under way to facilitate PSP in the rail network and in train operations were central to the overall strategy of lifting rail volumes to 250-million tons or more by 2030. In 2023/24, only 149-million tons were moved by rail and Creecy expressed optimism that volumes would be above 160-million in 2024/25.

However, increasing volumes to the 250-million target would hinge on attracting private investment in the form of TOCs and infrastructure concessionaires, with the infrastructure to be transferred back to Transnet at the end of the concession period.

The Minister acknowledged the immediate infrastructure-related constraints to attracting TOCs, notwithstanding the release of the Network Statement and tariffs for third-party access, as well as the establishment of the Transnet Rail Infrastructure Manager, as a separate entity from the Transnet Freight Rail Operating Company.

She, thus, urged potential TOCs to use the public processes surrounding the development of a futu...

In this opinion article, Dr Wikus Kruger outlines the key reforms needed to address the current problems with South Africa's once highly-respected programme for the public procurement of renewable-energy capacity from independent power producers.

South Africa's Renewable Energy Independent Power Producer Procurement Programme (REI4P) was once a global model of success. It drove down costs, attracted over R200-billion in investment, and delivered 11 000 MW of clean energy. But today, the programme is faltering. Grid constraints, slow procurement cycles, and institutional challenges are stalling progress. Without urgent reforms, South Africa risks deepening its energy crisis, deterring investors, and missing key climate goals.

Early Success, Growing Stagnation

The first four bid windows (2011-2015) were transformational, securing competitive prices and delivering projects on time and within budget. Costs for solar PV and wind energy fell by 77% and 93%, respectively. The programme was widely hailed as a best-practice model. However, from 2015 onward, delays and political uncertainty led to a three-year freeze. While REI4P was revived under President Ramaphosa, its momentum has never fully returned.

The last two bid windows have exposed major vulnerabilities. Bid Window 6 collapsed due to grid constraints, with only 860 MW of solar PV awarded and no wind projects proceeding. Bid Window 7 secured 1 760 MW of solar PV, but once again, grid bottlenecks prevented any wind projects from being awarded. The pattern is clear: procurement continues despite transmission bottlenecks, leaving much-needed projects stranded.

Transmission Failures are Strangling REI4P

The Eastern, Northern, and Western Cape - where the best wind resources exist - have little to no available grid capacity. Yet, procurement planning has not sufficiently aligned with transmission expansion. Eskom's Transmission Development Plan envisions adding 14 000 km of new power lines over the next decade, but execution remains sluggish.

To resolve this, South Africa must adopt international best practices:

Allocate grid capacity to prequalified projects (by adjusting the grid capacity allocation rules) to reduce investor uncertainty.

Introduce plug-and-play renewable-energy sites, where transmission infrastructure is pre-built.

Adjust bid scoring criteria to reward projects requiring fewer grid upgrades.

Without decisive action, South Africa will continue to see stalled projects, investor withdrawals, and worsening power shortages.

Fixing Procurement Design and Institutional Weaknesses

The Independent Power Producer Office (IPPO) was once a global benchmark for transparent procurement. But over time, institutional weaknesses have emerged. The office lacks the resources, staffing, and autonomy to run an effective programme.

Key reforms must include:

Establishing close coordination with the National Transmission Company of South Africa to align transmission planning and procurement decisions.

Empowering the IPPO to access top-tier legal, commercial, and technical advisory support.

Creating a dedicated research office within the IPPO for ongoing programme evaluation and innovation.

In the long term, the IPPO should transition to a permanent home within an independent transmission, system, and market operator (TSO) to streamline its role in procurement across public and private sectors.

As its credibility is strengthened, the IPPO's procurement role could expand to streamline current parallel public and private procurement processes. Acting as procurer for the entire distribution system (municipalities, Eskom Distribution, and large industrial users), the IPPO can leverage economies of scale and competitive pressure to reduce sector-wide costs and risks. And once it is transferred and absorbed by an independent TSO, it might also play a role in procuring capacity reserves for the Central Purchasing Agency and ancillary services for the System Operator.

Additionally, South Af...

Mineral and Petroleum Resources Minister Gwede Mantashe reports that discussions are under way within government and with manganese and chrome producers in an effort to halt the decline in domestic value addition, epitomised be the closure of more than half of the country's 59 chrome furnaces in recent decades.

Speaking at the National Union of Metalworkers of South Africa's bargaining conference, Mantashe argued that demand for the ferroalloys produced from both minerals was poised to rise, partly on the back of green technologies such as batteries but also from traditional sectors such as construction.

He argued that, through higher levels of local beneficiation these resources could "drive inclusive economic growth, industrialisation, and sustainable jobs".

"However, we are facing a set of serious challenges that require coordinated action among all stakeholders.

"Our ferroalloy industry that was once globally competitive and a source of pride for our economy, is facing a myriad of challenges with the chrome industry being the hardest hit.

"Currently, at least 30 out of 59 chrome furnaces in our country have been placed under care and maintenance, whereas some have been completely shut down and in so doing contributing to job losses."

Mantashe reported that a Ministerial Task Team, comprising of the departments of Trade, Industry and Competition, Electricity and Energy, and Transport and the National Treasury, had been convened to urgently develop a revival plan for the smelting sector and to ensure its long-term sustainability.

He said the task team was focused on several areas, including reviewing electricity pricing models; improving rail and port infrastructure; incentivising local beneficiation; and modernising legislative tools to give government the power to intervene where necessary.

Some of the policies and incentives being discussed with industry included the introduction an export tax to restrict the export of non-beneficiated minerals and/or quotas to restrict the amount of raw minerals that can be exported from South Africa.

"We continue to engage with investors, including Chinese investors, to bring beneficiation, technology, and industrial capacity into South Africa . . . These matters are not just words - they are being formalised as part of a memorandum of understanding under discussion with the Chinese government, where we are actively seeking more balanced cooperation that supports South Africa's industrialisation goals."

No mention was made by Mantashe of the US government's intentions to bolster its own domestic mining and processing sectors, with President Donald Trump having recently signed an executive order to "boost American mineral production, streamline permitting, and enhance national security".

The order is guided by a strategy aimed at reducing the US's dependence on China for critical minerals used in everything from fighter jets, semiconductors, electric vehicle batteries, and cell phones.

As tensions between South Africa and the US began to mount following Trump's inauguration and his hostile social media posts (which have subsequently been followed up with executive orders halting aid to South Africa and offering Afrikaner farmers refugee status on unsubstantiated allegations regarding land confiscations), Mantashe suggested that South Africa and Africa should retaliate by withholding mineral exports to the US.

In a five-month trading update published on Tuesday, JSE-listed Barloworld says the performance of the group's Mongolia business managed to somewhat counteract the contraction of its Equipment Southern Africa and Vostochnaya Technica (VT) divisions.

Barloworld's Ingrain business also saw a "significant improvement in operational results" following the rollout of a turnaround plan.

VT was the Caterpillar dealer in Russia, but had been scaled down in reaction to the sanctions imposed on this country following its invasion of Ukraine.

No new inventory had been ordered since July, last year, reported Barloworld in a conference call, with the company now focused on trading its legacy inventory to the limited number of customers it was allowed to trade with, while also servicing the equipment already on the ground.

In the first five months of the 2025 financial year, Barloworld generated R14.8-billion in revenue - 4.9% below the comparative five months of the prior financial year.

Operating profit from core trading activities declined by 20.5%, from R1.3-billion to R1.1-billion.

Within the Industrial Equipment and Services cluster, Industrial Equipment comprises Equipment Southern Africa and Barloworld Mongolia (as Caterpillar equipment distributors), as well as Industrial Services, which comprises VT.

Barloworld said Equipment Southern Africa's results were indicative of the slow recovery in the mining sector and the disruption caused by the unrest in Mozambique following the elections in that country.

"Mining customers continue to take a cautious approach to capital re-investment, whilst the construction industry recovery has not fully gained momentum," the company said in a statement.

Operating profit after fair value adjustments declined by 16.4%, from R688.5-million to R575.8-million.

The order book for this business had, however, increased by 13%, from R3-billion as reported in the prior period, to R3.4-billion as at the end of February.

Barloworld Mongolia generated strong revenue growth, noted the company, with operating profit up 26.7% to $22.6-million.

The order book had, however, shrunk substantially, from $117.8-million in the prior period to $27.8-million, following significant product deliveries since February last year to date.

VT's revenue of $60.6-million was 25.3% lower when compared with the prior period, impacted by lower activity levels.

Operating profit from core trading activities of $1.5-million was 91% lower than the prior period.

VT remained self-sufficient in terms of its funding requirements, said Barloworld.

"The independent investigation into potential export control violations is ongoing," the company added.

"In light of the complexities involved in the investigation, the US's Bureau of Industry and Security (BIS) has granted an extension of the deadline for the company to complete its investigation and submit a final narrative account of voluntary self-disclosure, to 2 June."

Concurrent with the ongoing BIS investigation, Barloworld said it continued "to review various options" in respect of its investment in VT.

Agricultural and food-and-beverage-related business Ingrain saw operating profit growth of 15.5%, to R232.4-million.

Barloworld confirmed that the overall group strategy of fix, optimise and grow remained unchanged.

* In February, Barloworld shareholders rejected a proposed R23-billion buyout offer from a consortium led by management (including CEO Dominic Sewela) and the Saudi Arabian Zahid Group.