Many mining companies are turning to hybrid energy solutions to cut costs and secure cleaner, more reliable power and reduce their reliance on Eskom. What does this shift mean for the utility’s relationship with the sector?

Speaking at the Investing in African Mining Indaba in Cape Town this week, Eskom’s Group Chief Executive Dan Marokane acknowledged the mining industry has been forced into energy production due to South Africa’s power challenges.

The move towards self-generation was not just a strategic decision but a necessity for mining companies looking to secure business continuity. The trend has also been facilitated by more flexible regulations, Marokane said. “Mining companies moved into energy out of necessity while we focused on Eskom’s recovery.”

Marokane outlined two key priorities for miners:

1. Consistent energy supply and a shift towards greener power sources to align with global sustainability expectations. “Mining operates in markets and value chains that are increasingly sensitive to the sustainability of energy. We have adapted our strategy to build our own renewable portfolio and, with improved performance, we’re seeing miners and other industrial customers returning,” he said.
2. Eskom is revising its business model to tap into excess capacity from large customers that self-generate power. The National Transmission Company South Africa will establish a transmission system operator within five years, allowing customers greater flexibility in grid interactions, he said. “We’re not very far from that. We spent time this week beginning to flesh out how that structure should look.”

Despite Eskom’s restructuring and the mining industry’s move towards self-generation, Marokane stressed that Eskom will remain essential to South Africa’s power supply. “The country will still require Eskom’s role even as the industry evolves because we provide baseload power.”

Looking ahead, he foresees a shift from a purely transactional relationship between Eskom and the mining industry to closer partnerships driven by energy security and sustainability demands. “If markets favour green energy, miners will partner with suppliers that can provide it. If there’s still a need for non-renewable energy for security of supply, they’ll make provisions for that,” he said.

“We’re getting closer to our customers and we will find new ways of working together. Energy is a fundamental part of the mining value chain and these relationships can no longer remain purely transactional.”