FAPA has been actively campaigning on more affordable electricity prices for many years, but so did other associations like the Energy Intensive Users Group of SA (EIUG) and the Minerals Council of SA (MCSA). The three Associations joined forces during 2020, based on their common efforts on pricing affordability, to approach the DMRE, DTIC, NERSA and Eskom in order to stress the current concerns on future sustainability, especially in view of the new Integrated Resource Plan (IRP) and the existing National Development Plan (NDP).
The escalation of power pricing by more than 500% over the last decade, has robbed the competitive nature of SA as a mining and industrial country; this much more factual based on base-alloys smelting of Cr, Mn and Si, where we have moved from the biggest producer in the world, to being the biggest exporter of our minerals and huge reduction in local smelting capacity, notable over the last 5-years.
In order to ensure the future and support the IRP and NDP, mining and industry requires the end to cross-subsidies which have exceeded by far the initial intend of these subsidies, but predominately, to achieve an industrial competitive tariff on electricity. Although our members produce different commodities, power pricing comprises between 30 and 50% of total production cost and therefore the main component to make or break profitability. As base load consumers, FAPA and the other Associations, are committed in finding a solution to this problem and to contribute positively to SA Inc.