Engineering News Online Audio Articles

Even if only incremental steps are taken, South Africa must continue to progress its electricity market liberalisation and reform agenda, such as launching the South Africa Wholesale Electricity Market (SAWEM), even if only involving a few organisations. Further, while there were many competing challenges to be addressed to ensure progress, grid access was highlighted as a key element in the coming year by the experts who participated in the 'South Africa's Energy Outlook 2026 – Sustaining Reform Momentum' webinar hosted by Creamer Media on January 28. The webinar was facilitated by law firm TGR Attorneys director Masedi Tlhong, with State-owned Eskom Group strategy and sustainability executive Nontokozo Hadebe, industry organisation South African Independent Power Producer Association chairperson Leoné Human, financial advisory firm Cresco associate director Olga Suchkova, renewable-energy trader Discovery Green head André Nepgen and industry organisation Energy Council of South Africa CEO James Mackay providing insights. Collaboration between all private and public parties and stakeholders must continue, as it helped to provide the certainty required for projects to remain bankable, said Suchkova. However, unlocking the grid was a critical element, with capacity urgently needed, she added. A report Cresco undertook alongside financial services firm Standard Bank in 2025 looked at the impact on the grid that the ageing coal-powered fleet will have, and it highlighted the urgent need to add new generation capacity. "Among the many challenges that have to be addressed at the same time, we need to ensure that new capacity is added to the grid," she said. Mackay highlighted that financial close decisions for renewable-energy projects had peaked in 2024 and, although the country was in a robust construction phase, investment decision-making for renewable energy projects was declining. Electricity demand has been declining for the past 12 years, including from 2025 to this year, and the reprieve from loadshedding could partly be attributed to this declining demand. However, electricity demand, and use, must increase to support and enable more rapid GDP growth of between 3% and 5%, which is needed to stimulate growth and investment and create jobs. "We need to get back up and running with the financial close process. Otherwise, by 2029, if demand bounces back by 16 TWh/y to 20 TWh/y, then we would be back in a loadshedding scenario. "We are not seeing investment that is sustaining a robust renewables industry, and are not building enough new generation to deal with this shift [in electricity demand]." Therefore, South Africa must urgently find short-term solutions to unlock grid capacity to add more generation sources, he said. When asked what the most critical element needed for the emerging energy market to scale was, Nepgen concurred that grid access remained a challenge and that maintaining the momentum of transformation was currently more about execution than policy. However, he highlighted a different consideration, namely that the majority of the country still did not have access to the wheeled electricity market. There were many reasons for this, including that many municipalities have not developed processes for the wheeling of electricity. He highlighted that, if access to wheeled electricity could be broadened to include municipalities, and large- and small-scale energy users, then demand for energy could flow from this, which would underpin supply and hence support investment in generation. "The reforms must address accessibility while addressing fairness and sustainability at the same time," he said. Human, meanwhile, noted that collaboration between public and private organisations could help to overcome the scale of the challenges, such as grid expansion to bolster access. She emphasised that, given the distances and magnitude of the grid development needed, cooperation between public and private organisations was ...

Eskom has requested the energy regulator to approve an interim tariff of 87c/kWh in favour of Samancor Chrome and the Glencore-Merafe Chrome Venture as a temporary measure to sustain smelter operations while talks continued in relation to a longer-term solution aimed at further reducing the tariff to 62c/kWh. The utility has also requested the National Energy Regulator of South Africa (Nersa) to extend, by a further 12 months, waivers both companies secured last year in relation to take-or-pay obligations included in their negotiated pricing agreements (NPAs) with Eskom, which came into effect in 2024. These stipulate that the ferrochrome producers should honour at least 70% of their contracted volumes; a condition that became unviable when production at several smelters was halted due to a lack of competitiveness. Six-month waivers were approved by Nersa in August after Samancor and Glencore-Merafe declared hardship in relation to the provisions, but these are due to expire at the end of January. Eskom Distribution's Gugulethu Dumakude acknowledged that the 87c/kWh tariff was not considered low enough for the ferrochrome producers to resume production at the levels assumed under the NPA, but indicated that it would help increase their consumption slightly from current levels. She added that the interim tariff, together with the take-or-pay waiver, would also create breathing space for Eskom and the Department of Electricity and Energy to finalise a more sustainable tariff solution with the ferrochrome industry. Ferroalloy Producers Association chairperson Nellis Bester confirmed that the industry required a tariff of 62c/kWh to be in a position to restart operations and avoid Section 189 retrenchment processes that had been initiated by various ferroalloy companies, including those outside of the ferrochrome sector. He, thus, also argued that the final solution negotiated should not be confined to the ferrochrome sector and should be extended to companies smelting manganese, silicon and vanadium, all of which were in distress as a result of "compounded electricity price increases". Bester noted that only four of South Africa's 48 ferrochrome smelter were currently operating, alongside only four of the 19 smelters in the other ferroalloy sectors. "Today electricity accounts for 40% to 60% of total production cost in the ferroalloys sector. "To sustain the sector, internationally competitive electricity pricing is essential," Bester said, while warning of widespread deindustrialisation and job losses in the absence of an electricity price that was supportive of local minerals beneficiation. Transalloys GM Theo Morkel amplified this position by sharing a cost comparison indicating that, even under its own NPA with Eskom, electricity represented $634/t of the cost of producing silicon manganese; well above international benchmarks of between $147/t at the low end and $338/t at the higher end. Hence, while supporting the immediate implementation of interim tariff relief for Samancor Chrome and the Glencore-Merafe Chrome Venture, Morkel said similar relief also needed to be extended to the rest of the ferroalloys sector, where closures and job losses also loomed. Congress of South African Trade Unions trade and industrial coordinator Tengo Tengela also supported the application for relief, warning that some 300 000 direct and indirect jobs were at risk should the smelters be forced to close. However, he called on Nersa to approve the application with the condition that there be a moratorium on further retrenchments by the companies. No timeframe was given for Nersa's decision in relation to the application, but Eskom said an approval would be required by the end of February at the latest.

The South African government will have no choice but to impose antidumping duties on imported vehicles, says Trade, Industry and Competition Deputy Minister Zuko Godlimpi. Godlimpi on Tuesday attended a briefing by his department and other auto industry roleplayers to the parliamentary Portfolio Committee of Trade, Industry and Competition on the implementation of the South African Automotive Masterplan. When quizzed by portfolio members on the impact of rapidly rising imports of completely built-up (CBU) vehicles from India and China on the local automotive industry, he indicated that government would use duties to protect its manufacturing sector. "We'll have no choice but to impose antidumping duties against our own allies. "It is not an affront on the relationship as such, but it is to tactically defend your employment capability in South Africa and the capacity of your industry to weather the storms – the storms being the general disruption of the auto sector globally – until we are in a position to produce new energy vehicles (NEVs) competitively and maintain a degree of internal combustion engine (ICE) [production]." International Trade Administration Commission of South Africa chief commissioner Ayabonga Cawe indicated that South Africa did "have room to manoeuvre" within its concessions to the World Trade Organisation (WTO). For CBU imported passenger vehicles, South Africa's bound rates were at 50%, with the current duties imposed under government's Automotive Production and Development Programme (APDP) set at around 25%, he noted. "On components, you also have room to manoeuvre, depending on the origin market, of anywhere between 10% and 12%." A bound rate is the maximum legally committed tariff rate a WTO member country has agreed to impose on imports of a specific product. South Africa was hard at work in its attempts to convince especially Chinese car makers to establish manufacturing operations in South Africa, added Godlimpi, noting that government wanted to add to the country's tally of seven assembly plants, instead of replacing or losing any existing plants. The automotive industry, South Africa's biggest manufacturing sector, on Tuesday painted a rather bleak picture of its future should government not come to its assistance. National Association of Automotive Component and Allied Manufacturers (Naacam) CEO Renai Moothilal described government's auto sector support programme – the APDP – as "stuck in the mud". In 2024, vehicle imports from China made up 22% of all vehicle imports to the country (up 368% from 2020), with 53% (up 135% from 2020) coming from India. (A number of well-known brands which are not from India assemble some of their models in that country, such as Toyota, Suzuki and Hyundai.) Moothilal lamented the fact that European and American manufacturers had invested in local assembly capacity, but that China and India had failed to followed suit. The rise in imports meant that local production levels had been stagnating below pre-Covid levels of around 600 000 units a year, with light vehicle production forecast to fall to around 560 000 units a year for this and the next year. Also, the percentage of locally made parts in these vehicles had been declining by an average of 1.1% a year over the past 25 years, he added. This and other factors had seen the implementation of short time, retrenchments and plant closures in the component manufacturing sector. Over the last three years, Naacam had recorded 13 component company closures, said Moothilal, with more expected this year. Among a raft of potential remedies, he believed that increasing duties on imported vehicles could be implemented immediately, as well as government embracing the preferential procurement of locally made parts and vehicles. Small Local Market; Big Problems Toyota South Africa Motors president and CEO Andrew Kirby highlighted in his presentation that the South African domestic new-vehicle market continued to lack scale. T...

A total of 332 generation and storage projects with a combined nameplate of 31.7 GW have either received budget quotes for grid connection in South Africa or have budget-quote applications pending for grid connection before 2030, a newly publicly available online portal shows. Of that, nearly 24 GW is made up of 204 advanced projects (mostly in the form of variable renewables projects) that are seeking to be connected to the grid over the coming five years. Produced by the National Transmission Company South Africa (NTCSA), the 'Generation Customer Connection Data Dashboard' first became publicly available in December. It will be updated periodically, with the current edition offering a snapshot of the situation as of November 18, 2025. The projects are not named, but the dashboard offers details of the technologies involved, with solar PV being the dominant technology seeking grid connection, as well as a geographical breakdown of the capacity, with the Free State leading with 4.2 GW across 31 projects. The dashboard includes projects with budget quotes that are already operational (128 projects, with a capacity of 7.6 GW); those in execution (67 projects, with a capacity of 5.7 GW); projects that have been issued with budget quotes for grid connection (23 projects with a capacity of 2.8 GW); and those that have formally applied for budget quotes for grid connection (114 projects with a capacity of 15.4 GW). Taken together, grid-connected projects that are operational, in execution or that have budget quotes issued for finalisation represent a combined capacity of 16.2 GW across 218 individual projects. The NTCSA has purposely included only projects with budget quotes approved or pending. This because such projects are either operational or considered shovel-ready, with project originators making the financial commitment associated with applying for a quote to be grid connected only once their project has undergone a detailed engineering design and secured the other approvals needed to proceed to construction. A separate South African Renewable Energy Grid Survey (SAREGS), which is published yearly, incorporates a far larger sample, including projects at a far less advanced stage. The 2025 edition of SAREGS indicated there was 220 GW of renewables project capacity at various stages of development, and those with budget-quote applications would represent the most advanced of such projects. The NTCSA dashboard shows that budget quotes have been granted for operational projects that include the technologies of wind, solar PV, concentrated solar power, landfill gas, hydro, gas, biomass, and hybrid projects. Those in execution or that have quotes issued, meanwhile, also include battery storage and nuclear, with the nuclear representing the additional capacity being introduced as part of Koeberg's life extension. Solar PV is the dominant technology represented, with 15.2 GW of capacity across all categories, including 3 GW of operational capacity; a figure that excludes South Africa's estimated installed base of rooftop or behind-the-metre solar of some 7 GW. The dashboard shows that there are grid-connection budget quotes being assessed for a further 68 solar PV projects with a combined capacity of 8.3 GW, mostly located in the Free State, Limpopo and North West provinces. The lion's share, or 5.2 GW, of that solar PV capacity could be introduced in 2027 should grid connections be secured. Wind also features prominently, with a total of 79 projects with a combined capacity of 9.6 GW reflected across all categories, including 12 projects representing 2.3 GW with budget-quote applications submitted. Most of this wind capacity is either operating or under development in the Western Cape and Eastern Cape provinces. A budget-quote application for 3 GW of gas-to-power, presumably linked to Eskom's proposed project in Richards Bay, in KwaZulu-Natal, is also reflected on the dashboard, as is 2.1 GW of battery storage across 20 projects...

Germany's special envoy for the Just Energy Transition Partnership with South Africa Rainer Baake says his country's ongoing commitment to the initiative is reflected by the fact that Germany has more than doubled its original financial commitment to €2.68-billion, from the initial 2021 pledge of €986-million. He also reported that more than €1.4-billion had already been disbursed under the programme, which is scheduled to run to 2027. Speaking in Pretoria at the tail-end of a visit to South Africa, Baake said the increase was a direct response to the strong demand for both the grant and concessional finance set aside to support projects and policies being implemented in line with the investment programme developed by the South African government. Having held more than 40 meetings during his visit – mostly with private companies but also with government officials – he reported "huge appetite" for the funding, particularly from the renewable-energy sector. Refusing to be drawn on recent comments by Electricity and Energy Minister Dr Kgosientsho Ramokgopa that the price of the debt component was too high, Baake noted that the policy loans extended to government by KfW involved interest rates that were "considerably cheaper" than prevailing market rates. Three such loans with a combined value of €1.3-billion had already been disbursed to the National Treasury upon the implementation of agreed energy sector reforms. The first €300-million policy loan extended in November 2022, with a 20-year maturity and five-year grace period, carried a variable rate at the time of signing of 3%, which had since reduce to 2.8%; this against market rates of 8.9%. The second €500-million loan approved in 2023 had a 15-year maturity and three-year grace period, and carried a fixed interest rate of 4.4%, which compared favourably to 12-year Eurobonds issued by the National Treasury in late 2023 that attracted rates of between 7.1% and 7.95%. The third €500-million loan approved in July 2025, with a 13-year maturity and three-year grace period, had a 4.31% fixed interest rate, against dollar-denominated bonds issued by the National Treasury at the time bearing a 6.25% interest rate. A similarly concessional €150-million loan had been approved in favour of the City of Cape Town in December 2024 for electricity infrastructure. Baake reported that concessional loans worth €1.07-billion had also been approved for electricity, green hydrogen and skills-development projects, as well as to support municipalities, alongside grants totalling €125.6-million. He acknowledged the headwinds that had developed internationally in relation to the energy transition, but said that Germany and the other remaining International Partner Group countries were committed to providing ongoing support to South Africa's Just Energy Transition Investment Plan (JET-IP). While the US had withdrawn, the remaining original partners of France, Germany, the UK and the European Union had since been joined by Denmark and the Netherlands in their support for the JET-IP. He also acknowledged the challenge that loadshedding had posed to the implementation of the programme, as South Africa had not been able to retire coal plants in line with their original decommissioning schedule. REFORM MOMENTUM Nevertheless, for economic and commercial reasons, he said South Africa's transition was poised to continue as there was no contradiction between climate and economic goals, with renewables being the cheapest source of new electricity. He also applauded the reform progress being made in South Africa's electricity sector to open it to private investment and competition, underlining the importance of the introduction later this year of a wholesale electricity market, which he hope would form the precursor for retail competition in future. "Where I live right now, in Berlin, you could choose between 180 retail companies, and if you go to the smallest town in Germany, you will still have at least 20...

Engineering News editor Terence Creamer discusses the World Bank and International Monetary Funds' upgraded economic growth outlook for South Africa, as well as the trade and geopolitical risks that the country will have to navigate.

After nearly a year of rumours about its possible closure, the axe has finally fallen on Nissan's assembly operations in Rosslyn, Pretoria. The Japanese group announced last year that it would close seven plants out of a global network of 17 manufacturing sites as the struggling carmaker reported a net loss of $4.5-billion for the financial year that ended in March, amid surging restructuring costs and the fallout of US President Donald Trump's trade war. Production in South Africa fell to around 17 000 units in 2024, as the Rosslyn-based facility was forced to end assembly of the popular NP200 half-ton bakkie and continue only with the Navara pickup. Production volumes at Nissan South Africa (SA) had steadily hovered short of 25 000 units a year for the last few years, down from well over 54 000 units in 2012. Navara assembly is expected to end in May. It's not all bad news for the South African automotive industry and the employees at the Nissan South Africa plant, however, as popular Chinese importer Chery is in the pipeline to acquire the plant. Chery has been a rising star in the domestic market, and currently sells well over 2 000 new vehicles a month, with the broader group – which includes brands such as Omoda, Jaecoo and Jetour – boosting that number to almost 5 000 units a month. Nissan on Friday confirmed that it had reached an agreement on the sale of its manufacturing assets in Rosslyn. The Japanese vehicle brand will, however, continue selling vehicles in South Africa and is not exiting the market. New product releases for 2026 will include the Nissan Tekton and Patrol. Nissan has been active in South Africa since 1961. Nissan said Chery SA will purchase the land, buildings and associated assets of the Nissan facilities, including its nearby stamping plant, in the middle of this year. The agreement will see roughly 700 out of the 800 Nissan employees within the plant being offered employment by Chery SA on what Nissan says will be "substantially similar terms and conditions as today". "Nissan has a long and proud history in South Africa and has been working to find the best solution for our people, our customers and our partners," commented Nissan Africa president Jordi Vila. "External factors have had a well-known impact on the utilisation of the Rosslyn plant and its future viability within Nissan. "Through this agreement we were able to secure employment for the majority of our workforce, thereby also preserving opportunities for our [parts] supplier network. "This move also ensures that the Rosslyn site will continue contributing to the South African automotive sector," said Vila. A spokesperson for Chery SA told Engineering News Online that the car maker cannot yet confirm what vehicle it aims to assemble at Rosslyn, or the purchase price for the facility.

The Presidency's Rudi Dicks, who is overseeing the economic reforms being implemented under Operation Vulindlela, says the unbundling of Eskom's transmission business cannot be done "half-heartedly" if South Africa is to introduce the competition needed to help improve electricity affordability. Speaking during a panel discussion hosted by Bowmans on the financing of South Africa's just energy transition, Dicks expressed his support for the full unbundling of the transmission business and assets from Eskom Holdings. He argued that this was necessary in light of the importance of the grid, and the expansion of the transmission infrastructure, to the introduction of new private generation capacity and to ensuring that transmission investments did not favour the "incumbent". "You've got to unbundle Eskom [and] not half-heartedly. You've got to unbundle it so as to be able to utilise the transmission assets to allow for investments in renewables, hybrid, gas, and others to be transmitted across the grid. "If we allow the existing transmission assets to remain [with Eskom Holdings], what will happen is that investment in transmission will be for the incumbent," he said, arguing that this was not a criticism of Eskom but a lesson from how both public and private incumbents operated globally when allowed to do so. He added that the high price of electricity had emerged as the key challenge facing consumers and that competition, including public sector competition in the form of Eskom Green, held the most promise for addressing the problem of affordability. In December, a revised unbundling strategy was approved for Eskom Holdings. Under the announced structure, the National Transmission Company South Africa (NTCSA) will remain a subsidiary of Eskom Holdings and will continue to own the transmission assets, while a separate Transmission System Operator will be set up outside Eskom to handle system and market operation, but without owning the underlying infrastructure. The approach has been criticised by Professor Anton Eberhard, of the Power Futures Lab at the University of Cape Town's Graduate School of Business, who argues that it is not supportive of the accelerated investment needed to ensure security of supply, particularly with various coal stations being retired in 2030. South African Photovoltaic Industry Association CEO Dr Rethabile Melamu has also expressed concern about whether NTCSA will be able to secure the funding needed for new grid investment, as well as whether there will be non-discriminatory treatment of Eskom Generation when compared with independent power producers. When announcing the new strategy, however, government indicated that it was aimed at preserving the financial stability of the Eskom Group by minimising disruptions to its highly leveraged balance sheet.

A new online portal has been launched to enable project originators and/or financiers to determine quickly whether the project being assessed aligns with the principles of South Africa's just transition and could, thus, qualify for just-transition financing. Developed by Trade and Industrial Policy Strategies (TIPS), the Just Transition Finance Tool is free to use and has been designed to provide a consistent, evidence-based way to assess a project's just credentials using an algorithm that interrogates the project's climate, socioeconomic and community objectives. TIPS research fellow Sandy Lowitt says this "three-legged stool" approach can be employed across projects of all sizes, be it a multibillion-rand energy or industrial investment, or small-scale community cooperatives seeking seed funding. Lowitt stresses, however, that the tool is limited to assessing the project's 'just transition' credentials and offers no view on the project's commercial viability, and does not replace the need for a due diligence. Given that South Africa's project pipeline includes climate-related developments and initiatives driven by socioeconomic objectives – such as employment creation, service delivery and community development – the tool incorporates two assessment gates: a green, or climate-led gate; and a socioeconomic improvement-led gate. Both pathways require meaningful contributions across all three legs of climate, socioeconomic and community improvement, but the thresholds are adjusted to reflect the project's primary purpose. This, Lowitt explains, avoids penalising projects that are socially transformative but not primarily environmental in nature. On completing the online submission, which involves clear definitions, dropdown menus and guided activity lists to remove ambiguity, applicants will receive an instant response informing them whether or not a project qualifies. Qualifying projects also receive a certificate with a unique QR Code as proof that the project meets the just transition project criteria. However, TIPS is still seeking formal recognition for this certification, ideally through a government sponsor. TIPS is also keen to enter into partnerships with financial institutions so that applicants whose projects fail to secure certification can be offered feedback, as well as guidance on how to improve the project's credentials. The tool has, thus, been developed to be embedded into third-party websites to facilitate such partnerships. Lowitt expressed optimism that the move to standardise the way just-transition projects are assessed will help address some of the challenges that have arisen since the launch of South Africa's Just Energy Transition Investment Programme (JET-IP) in 2023. There has been particular concern over the slow implementation of projects, limited funding disbursements from the international donors that pledged more the $12-billion in support of the JET-IP, as well as so-called 'just transition washing', whereby conventional projects have been rebranded in a bid to access funding. The Just Transition Finance Tool, which was launched formally at an event hosted by Bowmans, can be access through: https://www.tips.org.za/projects/just-transition-finance

JSE-listed automotive group Metair has finalised the formation of its new aftermarket parts and retail division, in line with the group's strategy of diversification through the establishment of dedicated business divisions. The new focused division will be led by a former ZF Group MD, Gerhard Braun, who will report to group CEO Paul O'Flaherty. Metair says Braun will be responsible "for driving operational excellence, whilst ensuring that each brand retains its distinct value proposition and continues to serve its customer base effectively". The new division includes five separate verticals, being AutoZone, MOVE, ATE, First Battery and QSV. "This marks an important step in our ongoing strategic reset, which is designed to ensure a robust and sustainable, growth-oriented Metair," says O'Flaherty. "Our carefully considered divisionalisation focus will enhance strategic clarity, operational efficiency and financial transparency, enabling us to better serve the respective markets and customer segments. "It will also maintain brand and channel independence, which are key elements of our agile operating model, as we advance the group's overall strategic ambitions." The new division, and its verticals, will be supported by the recently implemented Metair Group Shared Services, which encompasses the finance, IT, human resources, payroll and company secretarial functions. First Battery's manufacturing operations will be established as its own operating unit within Metair's second division – Automotive Component Manufacturing – which includes Hesto Harnesses, Automould, Lumotech, Unitrade, Supreme Spring and Smiths Manufacturing. "I am pleased to welcome Gerhard to the Metair Group," notes O'Flaherty. "He brings 25 years of experience in the automotive sector, having held senior leadership roles both across Africa and internationally. "His career includes MD roles at ZF Group, business unit leadership at Tenneco, and leading franchise operations for Motus. "We look forward to his positive impact as we build the new division and shape the Metair of the future."

The International Monetary Fund (IMF) has made a small 0.2 percentage point upward revision to South Africa's projected growth for 2026 in its January World Economic Outlook (WEO), forecasting that the economy will grow by 1.4% this year. Its 2027 growth projection of 1.5% for South Africa, which was published in October, has been sustained, while the January WEO estimates that South Africa's GDP expanded by 1.3% in 2025. The IMF update for South Africa is in line with projections released by the World Bank in its January 'Global Economic Prospects' report, as well as the IMF's small upward revision for global growth. The IMF expects the global economy to expand by 3.3% in 2026, also a 0.2 percentage point upward revision relative to its October report. It has sustained its 3.2% projection for world growth in 2027. Global headline inflation, meanwhile, is expected to decline from an estimated 4.1% in 2025 to 3.8% in 2026 and further to 3.4% in 2027. "This steady performance on the surface results from the balancing of divergent forces," the report states. "Headwinds from shifting trade policies are offset by tailwinds from surging investment related to technology, including artificial intelligence (AI), more so in North America and Asia than in other regions, as well as fiscal and monetary support, broadly accommodative financial conditions, and adaptability of the private sector." The January WEO also forecasts that growth in sub-Saharan Africa will accelerate from 4.4% in 2025 to 4.6% in 2026 and 2027. This upward revision is supported by buoyant conditions for certain commodities produced in Africa, macroeconomic stabilisation in some countries, and reform efforts in key economies, with research department division chief Deniz Igan making specific reference to South Africa's structural reforms during a media briefing. However, the January WEO also warns that risks to the outlook remain tilted to the downside, with economic counsellor and director of the research department Pierre-Olivier Gourinchas confirming that the current outlook assumed that there would be no additional hike in tariffs by the US beyond those imposed last year, as well as no trade policy retaliations by other countries. TARIFF RISKS However, the IMF confirmed that the projections used in the January WEO Update were finalised before the end of December, predating the US military's capture of Venezuelan President Nicolás Maduro and a threat by US President Donald Trump that he would impose additional tariffs on several EU countries that he felt were impeding his acquisition of Greenland. On January 17, Trump issued a tariff ultimatum to Denmark, Norway, Sweden, Finland, France, Germany, the Netherlands, and the UK, indicating that a 10% tariff would be imposed on February 1, rising to 25% on June 1, unless an agreement was reached on America's "complete and total purchase of Greenland". Gourinchas noted that the upgrade to the WEO growth outlook in January relative to October was partly attributed to the fact that the tariffs imposed by the US, as well as the retaliatory actions taken by other countries, were more moderate than had been anticipated when Trump first announced the Liberation Day tariff in April. In addition, US retailers had refrained from passing on the costs of the higher tariffs to consumers. For this reason, geopolitical risks and further trade tensions were among the key downside risks highlighted by the IMF. "We are establishing our projections in the WEO under the assumption that the level of tariff remains unchanged," Gourinchas said, indicating that its current projections were for the effective US tariff rate being imposed on the rest of the world to remain at about 18.5%. "If we were to enter a phase in which there would be [tariff] escalations and tit-for-tat policies … that would certainly have even more of an adverse effect on the economy, both through direct channels, but also through confidence, investment and potentially...

Isuzu Motors South Africa has launched the MVR bus chassis in South Africa, fitted with a Marcopolo Torino body. Designed as a dedicated commuter bus chassis, the local arm of the Japanese vehicle maker is especially proud of its soft ride bus suspension system. "This configuration, featuring multi-leaf springs, shock absorbers and stabiliser bars at both the front and rear, ensures a smoother ride, while maintaining optimal stability and handling – a significant improvement over the truck-based bus chassis used by many competitors." Sporting a 6 000 mm wheelbase, the chassis measures 11 594 mm in length and 2 367 mm in width, translating to an overall 12 600 mm by 2 600 mm with the bus-body installed. Powering the MVR is Isuzu's 7.79-litre inline six-cylinder 6HK1-TCS diesel engine, delivering 221 kW at 2 400 rpm, and 980 Nm of torque from 1 450 rpm. The engine is paired with a six-speed Eaton manual transmission. The bus also features a full air foundation braking system, exhaust brake and a magnetic retarder mounted to the rear of the transmission. With its higher stance compared with truck-based alternatives, the MVR offers superior approach and departure angles, which makes it ideal for both urban and rural environments, says Isuzu. Inside, the bus can accommodate 66 seated passengers, seven standing passengers, plus the driver. LED headlamps and tail lamps, automatic headlights-on and anti-lock braking are standard on the bus. Optional comfort features include air-conditioning, USB charging ports and a sound system. Isuzu Motors South Africa commercial vehicle and light commercial vehicle product planning department executive Kevin Fouché says the introduction of the new bus chassis is a "major step forward from previous Isuzu models and competitor offerings". "The MVR is designed from the ground up as a true bus chassis. "Every component, from the suspension to the transmission and retarder, has been optimised for passenger comfort and efficiency. The result is a durable, fuel-efficient and reliable solution requiring minimal modification during body installation."

Engineering News editor Terence Creamer discusses the December announcement by power utility Eskom and government of a revised unbundling plan for the State-owned entity; the reasons given for not transferring ownership of Eskom's transmission assets to the Transmission Systems O

The immediate priority of the Electricity Market Advisory Forum (EMAF), which was appointed by the National Energy Regulator of South Africa (Nersa) in December, will be to offer input on the regulatory instruments needed to facilitate the launch of the South African Electricity Wholesale Market (SAWEM), including the market code and rules, as well as the trading arrangements and platform. The 14-member EMAF is yet to be formally convened, but Nersa executive manager for electricity regulation Rhulani Mathebula has been appointed by the regulator to chair the forum, which is expected to be formerly launched in the coming weeks. The other members have been named as Mutshidza Nndwamato, of the Association of Municipal Electricity Utilities; Letlhogonolo Tsoai, of Business Unity South Africa; Mutenda Tshipala, of Eskom Holdings; Dr Willem den Heijer, of the Ferro Alloy Producers Association, Shreelin Naicker, of the Financial Sector Conduct Authority; Lovemore Chilimanzi, of the South African Electricity Traders Association; Craig Morkel, of the South African Oil and Gas Alliance; Nicole Loser, an attorney and legal consultant to the Just Energy Transition Africa Initiative; Dr Graeme Chown, an independent consultant, Professor Katleho Moloi, of the University of South Africa; Professor Simon Roberts, of the University of Johannesburg, Dr Thando Vilakazi, of the Competition Tribunal; and Dr Tracy Ledger, of the Public Affairs Research Institute. Alternate members include Professor Vally Padayachee, of the Association of Municipal Electricity Utilities and Tendani Mutshutshu, of Eskom Holdings. The EMAF, which has been appointed to advise the regulator in line with provisions for such structures in the National Energy Regulator Act, is expected to be in place for six years; enough time to oversee the creation of the SAWEM and the establishment of the independent Transmission System Operator envisaged in the Electricity Regulation Amendment Act. The forum's composition and mandate could be revised following the completion of a mid-term review in three years, however, Nersa has also reserved the right to appoint further members at its discretion. Mathebula tells Engineering News that the terms of reference and operational model, including meeting schedules, will be finalised collectively once the EMAF has been formally convened. However, the forum's initial agenda will be driven by the impending launch of the SAWEM, which is still set for April; a timeline that depends in large part on Nersa providing its approval to the faciliatory regulations and instruments required for the functioning of the market. "I also want to stress that the EMAF does not replace public consultations and hearings and is not a decision-making body. "Rather, what the regulator is acknowledging is that there are expertise in the industry … that can benefit the work of the regulator, as well as the country, and the regulator is using this vehicle to access that pool of expertise to improve the quality of its decisions." The members of the EMAF were selected from a long list of about 40 names arising from nominations made by the public. While electricity supply industry knowledge was an important criteria in the final selection, Nersa strategic adviser Mark Beare said the regulator also wanted to include individuals with other expertise, particularly in relation to the environment, consumer protection and competition. "The Electricity Regulation Amendment Act is clear that it wants a competitive market. So, it was felt that in amongst all the other skill sets, competition was going to be an important one," Beare tells Engineering News. The issue of genuine and fair competition within the SAWEM also arose during recent hearings into the National Transmission Company South Africa's application for a Market Operator licence, which was subsequently approved. Some stakeholders urged Nersa to play close attention to the balance between Eskom Generation's fixed and...

For the first time, South Africa has a long-term Foot and Mouth Disease (FMD) strategy to take it to FMD-free status, eventually without vaccination. Agriculture Minister John Steenhuisen on January 14 announced the Department of Agriculture's (DoA's) ten-year phased plan starting with stabilisation, progressing to consolidation and eventually removal of vaccination. The plan starts with immediate mass vaccination in hotspot provinces, targeting the vaccination of 90% of South Africa's commercial cattle, 80% of communal cattle and 100% of feedlots and dairy cattle within 12 months. Vaccines from Argentina, Botswana and Türkiye will be used, which will be supplemented by State-owned veterinary vaccine producer Onderstepoort Biological Products' local production of 20 000 doses a week from March. The local facility is expected to increase its vaccine production toward a 960 000-dose capacity target. Steenhuisen expects the country to receive five-million vaccine doses through imports by March. The department has submitted applications to the South African Health Products Regulatory Authority to authorise the importation and registration of the Biogenesis vaccine. Steenhuisen confirms that more than two-million cattle have been vaccinated since the current FMD outbreak started in 2022. It is estimated that the livestock industry has suffered R5.6-billion in export losses as a result of FMD since the start of 2025. He adds that the department will soon submit, to Cabinet, a memorandum to declare FMD as a National State of Disaster, which will enable government to rapidly deploy national resources for supplies, equipment, vehicles and facilities to support the fight against FMD and enact directives and regulations in a more timeous manner, as well as enhance government's powers to regulate the movement of livestock. The department has been strengthening the national laboratory network through the Agricultural Research Council (ARC) to increase diagnostic capacity and ensure timely test results across State laboratories. The department has also started implementing a digital livestock identification and traceability system in partnership with the Council for Scientific and Industrial Research and Red Meat Industry Services to track animal movements and support surveillance. Steenhuisen stresses that vaccination is not a silver bullet and must be accompanied by good on-farm biosecurity and movement controls. Becoming FMD-free will ultimately require coordinated and targeted efforts by the State, farmers, veterinarians and other organisations to report clinical signs of FMD and adhere to biosecurity measures. DoA biosecurity coordination chief director Dr Emily Mogajane says the FMD plan targets the epicentre of FMD outbreaks in Phase 1, including KwaZulu-Natal, Gauteng and North West, with Phase 2 aimed at establishing buffer zones around areas such as the Northern, Western and Eastern Cape provinces to prevent infection. "The goal is to interrupt virus transmission and reduce disease incidences to low levels in two to three years."She affirms that laboratory diagnostic capacity is being reinforced by coordination of provincial veterinary laboratories to speed up reference testing, while the ARC and vaccine manufacturers are being supported to conduct vaccine-matching and target product profile assessments to ensure imported vaccines match circulating serotypes. The DoA is working to build a robust database and surveillance system for FMD; however, Mogajane emphasises the importance of farmers, auctioneers, speculators and other partners adhering to movement controls and other disease spread measures. The DoA proposes in its mass vaccination plan for FMD that 19.5-million cattle need to be vaccinated across 234 municipalities, of which 8.2-million are classified as a primary priority, 10-million are classified as a secondary priority and 1.2-million are classified as a tertiary priority. Ultimately, Phase 1 (years one and two) of ...

The South African Photovoltaic Industry Association (SAPVIA) has added its voice to those expressing concern about the potential negative consequences arising from the revised unbundling plan for Eskom, which was announced in December. Under the revised structure the National Transmission Company South Africa (NTCSA) will remain a subsidiary of Eskom Holdings and will continue to own the transmission assets, while a separate Transmission System Operator (TSO) will be set up outside Eskom to handle system and market operation, but without owning the underlying infrastructure. The Electricity Regulation Amendment Act, which came into force in 2025, set a five-year timeframe for the creation of an independent TSO, and SAPVIA was among those anticipating that the new fully independent transmission entity would own the grid assets, raise capital on its own balance sheet, and operate free from Eskom's institutional incentives. CEO Dr Rethabile Melamu believes the revised structure creates practical problems, including the fact that a TSO without assets will be unable to raise capital at competitive rates to finance the 14 500 km of new transmission lines and other supporting infrastructure that South Africa requires. In addition, the entity will remain dependent on an Eskom subsidiary for network access, perpetuating concerns about non-discriminatory treatment of Eskom Generation when compared with independent power producers. She also highlights that the structure keeps critical grid infrastructure on Eskom's distressed balance sheet rather than creating a standalone, investment-grade transmission entity. "The Department of Electricity and Energy and Eskom need to clarify how this structure will attract the private and development finance investment that transmission expansion requires," Melamu tells Engineering News. "Transparent governance, operational independence from Eskom Generation, and credible timelines for full separation will be essential to maintaining investor confidence. As currently articulated, the revised plan falls short of what the sector needs," she argues. Similar concerns have been raised by other commentators, including Professor Anton Eberhard, of the Power Futures Lab at the University of Cape Town's Graduate School of Business, who warns that failing to ensure that the transmission grid is "fully liberated" from Eskom could compromise future investment and increase the risk of loadshedding from 2030. For SAPVIA, resolution of the unbundling issue is particularly important given that it views access to grid infrastructure, both at a transmission and a distribution level, as the most pressing issue facing South Africa's electricity supply sector in 2026. While there are indications that PV installations could slow globally this year for the first time since its emergence as a significant technology about two decades ago, the association is optimistic of continued growth in South African installations. Melamu highlights continued interest from renewables investors, noting that the 2025 South African Renewable Energy Grid Survey identified 117 GW of renewable-energy projects at advanced stages of development; capacity that already exceeds the 71.7 GW envisioned in the Integrated Resource Plan of 2025 over its entire 16-year horizon. "The appetite for investment is clearly not the constraint; the grid is," she avers. On the transmission side, SAPVIA welcomes the progress being made on the Independent Transmission Programme, but it also notes that Phase 1 addresses only a fraction, or 1 164 km, of the new lines required this decade, and will also not be operational until 2028 at the earliest. "In the interim, projects in high-resource areas (particularly the Cape regions) compete for limited connection capacity." At the distribution level, meanwhile, inconsistent municipal implementation of wheeling frameworks and small-scale embedded generation rules are frustrating private investment. "The National Energy R...

Eskom has offered assurances that the power system is more stable and predictable than it has been for the past five years in light of a strong recovery in the energy availability factor, a decline in unplanned breakdowns, more predictable planned maintenance and the return or introduction to service of some 4 400 MW of capacity when compared with the previous year. The improvements, CEO Dan Marokane says, have had positive economic spinoffs in the form of improved investor confidence, and have also contributed to South Africa's first credit rating upgrade in two decades. The stabilisation has been facilitated by a R230-billion debt-relief package, improved maintenance planning and operational performance at Eskom and ongoing structural and regulatory changes, now also backed by legislation, that have enabled the introduction of non-Eskom supply. There is some uncertainty, however, on whether the current period of stability will add further impetus to the reforms that have been pursued to improve the long-term sustainability of the electricity supply industry, or whether it could emerge as a reason for slowing the pace of these reforms. This ambiguity is partly reflected in the views of the electricity industry commentators that Engineering News canvassed for their views on what issues should receive priority in 2026. More specifically, whether Eskom's recently revised unbundling plan is supportive of the investments needed to ensure long-term security of supply and greater affordability for both large users and households. All respondents highlighted the importance of Eskom's unbundling, but some raised questions about the model that has now been adopted, and which has the backing of Electricity and Energy Minister Dr Kgosientsho Ramokgopa. Under the revised unbundling framework, the National Transmission Company South Africa (NTCSA) is set to remain a wholly owned subsidiary of Eskom Holdings and retain ownership of the transmission system assets, while a new Transmission System Operator (TSO) will be established as a new State-owned company outside of Eskom Holdings. The framework suggests that the TSO will develop and approve the Transmission Development Plan (TDP), operate the power system, run the wholesale market, act as the central purchasing agency and provide nondiscriminatory access to the grid for all market participants. The NTCSA would remain the owner of the transmission assets, however, and will be responsible for financing, constructing and maintaining the physical grid, including the build associated with the TDP. UNBUNDLING 'HOT POTATO' Energy Council of South Africa CEO James Mackay describes the unbundling framework as a "hot potato", indicating that valid points and concerns have been raised by both supporters and opponents. "The optimal end state is to move the transmission asset base into an independent TSO. But, timing, risk and ensuring Eskom Generation doesn't collapse is equally important. So, we need stepped implementation, and I think what Eskom has proposed is a palatable first step if it is done urgently," Mackay tells Engineering News. However, Professor Anton Eberhard, of the Power Futures Lab at the University of Cape Town's Graduate School of Business, argues that the revised plan is not an optimal solution for accelerating investment, as well as for widening competition and private sector participation. "Eskom needs to explain why it is proposing a sub-optimal unbundling outcome which may be in its own narrow interests but not that of the sector or country as a whole," he tells Engineering News. For Eberhard, the most pressing issue facing the electricity supply industry in 2026 is, thus, to have a transmission grid that is "fully liberated" from Eskom. Failure to complete this fundamentally important structural reform, he adds, will compromise future investment and competition in the power sector and greatly increase the risk of loadshedding from 2030. "Eskom, as the dominant generator ...

The African Association of Automotive Manufacturers (AAAM) has set eight goals for the new year, says CEO Victoria Backhaus-Jerling. "As we enter 2026, we proudly declare this the year of 'Progressive development through collaboration'. "This is the year where momentum turns into measurable outcomes." The first of the industry body's goals for this year is to unlock intra-African trade through the ratification of the automotive rules of origin under the African Continental Free Trade Area (AfCFTA). In February, Africa's heads of State are expected to formally adopt the 40% African originating content threshold, which Backhaus-Jerling describes as an important milestone that will allow automotive products to begin trading under the AfCFTA framework. "We will work closely with Afreximbank, the AfCFTA Secretariat and African governments to support our members through expert guidance and implementation," says Backhaus-Jerling. AAAM's second goal for the new year is to accelerate automotive policy implementation across the continent. "We will support the rollout and refinement of automotive policies in Egypt, Ghana, Côte d'Ivoire, Kenya, Nigeria, Ethiopia, Senegal, Tanzania and Algeria, and continue engaging new markets such as Angola," notes Backhaus-Jerling. Policy certainty remains the foundation of sustainable industrialisation, she adds. The third goal is to advance component manufacturing and localisation. "Our objective is to secure at least five concrete component manufacturing investments in Africa, driven by targeted matchmaking, feasibility studies and strategic partnerships," says Backhaus-Jerling. AAAM will also spend the year focusing on enabling legislation that supports the full spectrum of new-energy vehicle technologies in Africa. The automotive body says it will also focus on continuing to source, develop and provide reliable automotive data and statistics across the continent. Accurate, credible data remains critical for informed policymaking, investment decisions and tracking the progress of Africa's automotive industrialisation, notes Backhaus-Jerling. She adds that AAAM will also continue to build capacity across government and the automotive industry through a second cohort scheduled to enter the Government Executive Short Course, as well as the launch of an Industry Executive Short Course. A seventh goal for AAAM is a focus on mineral beneficiation and value-chain integration. As a strategic partner to the Investing in African Mining Indaba 2026, AAAM believes it will help to connect Africa's mineral wealth to automotive manufacturing opportunities. An eighth, and last, goal is to bring affordable mobility to Africa. "Through collaboration with vehicle asset-financing stakeholders, we will continue working toward accessible, sustainable mobility solutions for Africans," says Backhaus-Jerling.

A new scenario analysis of global trade points to ongoing trade growth over the coming decade despite the imposition of tariffs and rising geopolitical fragmentation. However, it also suggests that the shape of trade could change considerably over the period, including for South Africa. Published by the Boston Consulting Group (BCG), the analysis incorporates four scenarios, including a so-called 'patchwork' scenario that BCG says is gaining momentum. BCG Global Advantage Practice global leader Aparna Bharadwaj, who co-authored the report, argues that the future of global trade won't be defined by a single set of rules but by a patchwork of relationships and regional priorities. "For businesses, this isn't just a policy shift. It's a strategic inflection point. Our modelling shows that even amid rising fragmentation, trade remains on a clear growth trajectory, and the advantage will go to those who move early to adapt and lead in this evolving landscape," she adds. Under the patchwork scenario goods trade is more resilient than many would anticipate given mounting frictions, epitomised by the tariffs imposed by President Donald Trump; actions that have expanded the share of US imports covered by tariffs from 13% to 61% since January 2025. Trade grows under the scenario by 2.5% yearly from around $23-trillion in 2024 to nearly $30-trillion in 2034 and slightly fastener than global GDP. However, the trade lanes those goods travel are "dramatically reshaped", with trade flows gravitating around what the BCG describes as four main nodes, namely the US, China, and two informal groupings labelled the 'Plurilateralists' and the 'BRICS+ excluding China'. The BRICS+ grouping includes South Africa, alongside Brazil, Russia, India, and nations that joined later, such as Egypt, Ethiopia, Indonesia, Iran, and the United Arab Emirates. Trade relationships involving this grouping is shown to expand with the Global South as well as China, facilitated by the steps being taken by BRICS+ to collaborate with each other on trade. The approach to trade differs from country to country, with some negotiating deals with other groupings and some not. However, most typically prioritise sovereignty and retaining policy flexibility rather than entering deeper integration frameworks. BRICS+ nations excluding China face significant trade winds as they navigate steeper US tariffs of 27.5% while deepening commercial ties with China and the broader Global South, the reports states. Nevertheless, the findings project 3.3% annual growth through to 2034, with trade linked to China accounting for 40% of this increase. "What makes this trajectory particularly compelling is the infrastructure being built to accelerate intra-BRICS+ commerce," the BCG states. "Institutions like the BRICS New Development Bank and expanding non-USD local-currency payment rails are reducing financing and settlement frictions that have historically constrained South-South trade. "Enhanced logistics connectivity, customs simplification and harmonisation, and digital trade processes are providing practical enablers, while business-led initiatives such as the BRICS Business Council are gaining traction. "As the bloc works to narrow its current $93-billion trade deficit with China, these mechanisms will be critical to unlocking comparative advantages in energy, metals, mining, and agribusiness, while India and Brazil continue scaling their manufacturing and higher-value production capabilities." Meanwhile, the analysis points to the US's share of global goods trade declining as it maintains its 'America First' focus, while China's trade growth is projected to grow. "China's trade growth with the Global South would be driven by its growing need for energy, foods, and industrial inputs, as well as new markets for its finished goods. The BCG model outlines particularly strong 5.5% CAGR for China over the next decade with other BRICS+ nations and 3% CAGR with the rest of the world.

In this article, EE Business Intelligence MD Chris Yelland and consultant Paul Vermeulen argue that mismanagement is not the only reason for the failure of municipal electricity distributors and that larger design flaws should also be taken into account. They also assert that better debt collection alone will not address the crisis and that structural remedies are needed to rebalance risk and cost across the electricity value chain. South Africa's municipal electricity debt crisis is often reduced to a familiar story: failing councils, weak billing systems, political interference, and a culture of non-payment. There is truth in that, but it is incomplete. Municipal electricity debt has become a macroeconomic and industrial issue because electricity distribution is not a niche municipal service – it is a central artery of the economy. Municipal distributors supply households, malls, office parks, factories, hospitals and public infrastructure. When municipal electricity trading accounts collapse, the effects ripple outward: maintenance is deferred, outages multiply, network losses rise, and investment decisions tilt away from municipal supply areas. The result is a slow degradation of reliability, affordability and competitiveness. The uncomfortable implication is that municipal arrears are not simply a symptom of poor local governance. They are also the predictable outcome of an electricity distribution industry (EDI) structure that has, over time, placed municipal distributors in an increasingly untenable position – financially, operationally and politically. The crisis should properly be framed as a structural misalignment at the centre of South Africa's EDI, with Eskom in the thick of it. Structural lock-in: how municipalities became dependent on Eskom Historically, many municipalities generated, transmitted and distributed their own power largely to "white" residents, businesses and services, with revenues aligned to local networks and local responsibilities. Over time, that model was dismantled. Eskom's centralised generation expanded, while the municipal customer base grew and municipalities transitioned into bulk purchasers – effectively retailers and network operators – and no longer generators. That shift created a dependency on Eskom that has proven extraordinarily difficult to escape. Most municipalities now source virtually all their electricity from Eskom under bulk supply agreements, while carrying expanded responsibility for operating, maintaining and growing their local distribution networks. In theory, municipalities can diversify supply through Independent Power Producers (IPPs). In practice, their ability to do so has been constrained by regulation, licensing and ministerial determinations, complex procurement rules, competency issues, and unsettled wheeling and trading frameworks – even where network capacity exists. This "locked-in dependency" is such that municipalities do not have own generation control or practical freedom to procure competitively at scale, but remain fully exposed to Eskom's escalating tariffs and demand penalties. This lock-in matters because it turns municipal electricity distribution into a pass-through business with a widening structural gap: the municipality must buy at whatever Eskom charges, but sell into a local economy with limited affordability, weak payment discipline, and growing alternatives for better-resourced customers. Tariffs and non-payment: the post-2007 affordability shock In addition to governance issues, a driver for municipal failure is the escalation in Eskom's bulk tariffs from about 2007 onward – not merely above inflation, but at levels that completely rewired the affordability of electricity for households and businesses. The dramatic post-2007 electricity price trajectory indicates steep increases coinciding with the onset of loadshedding and Eskom's new-build programme. The core point is not the exact percentage in any single year – it is the compoundi...