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The News That Matters about the Nuclear Industry

How the South African government shafts renewables, in its policy fixated on nuclear power

flag-S.AfricaNuclear fixation shafts renewables, Mail &Guardian, Africa 21 NOV 2014 00:00 SIPHO KINGS The third window is waiting to be signed off but the energy department is preoccupied elsewhere Within two years, South Africa could have a further 1 200 megawatts (MW) of renewable energy entering the grid. The bidders have been selected and the companies are waiting for financial sign-off so they can start building.

But policy uncertainty and a new focus on nuclear energy are responsible for a nearly 18-month delay in the government giving them the go-ahead, industry insiders say.

In the wake of the 2009 energy crisis, the energy department set out an ambitious renewable energy programme: independent power producers (IPPs) would build the capacity to produce 3 725MW of electricity. This was split into three bidding opportunities, or windows, with companies bidding for a certain allocation in each.

The first two were hailed as great successes and, for the past three years, South Africa has been listed as one of the top five destinations for investment in renewable energy. Wind energy is already producing 660MW. Updated plans envision 9?800MW of solar, 3 300MW of concentrated solar and 4 400MW of wind energy by 2030.

But the third window has been delayed repeatedly. Several concerned individuals, working for renewable companies and unwilling to disclose their names for fear of jeopardising their relationship with the government, said political considerations were to blame.

“We have been told that the new minister’s [Tina Joemat-Pettersson] mandate is strongly towards nuclear energy,” said one………..

The renewable energy companies, the majority of which provide wind and photovoltaic power, are incurring costs all the time. These include leasing the land on which the power stations will be built, which is spread out across the Eastern, Western and Northern Cape.

If the delays continued, the sources said, there would be a point beyond which companies would be unable to recoup their costs, even if they started producing power soon. “We are not far from that point,” warned one renewable company employee. ………

A chance to reindustrialise
Groups such as Cosatu have hailed renewable energy as a chance to “reindustrialise” the country and companies are required to spend up to 70% of their budgets locally. Hundreds of millions of rands have been spent building factories to produce parts locally, such as the R300-million wind tower factory in Atlantis outside Cape Town. Solar panel factories alone have created 500 jobs.

This week the South Africa Renewable Energy Council said delaying the third window would have “extremely adverse consequences” for the industry and could also jeopardise the planned fourth renewable window.

Unlike South Africa’s centralised and state-owned power plants, renewables are financed by the private sector. The government, through Eskom, signs an agreement to buy their electricity at the rate presented in their bid. But they carry the risk.

The owner of one solar company said: “The worst thing for investors is uncertainty. The first two windows attracted so much investment and goodwill because the government was decisive. That is being thrown out of the window.”

If the third window was delayed, and there was another window to come, companies would hesitate to gamble with their money, they said………

Policy uncertainty
Twenty-six renewable energy projects have already been connected to the grid. The more than 60 projects have brought in R120-billion in foreign direct investment. Many of these are ahead of schedule, such as the 96MW Jasper solar plant near Upington in the Northern Cape.

It is the continent’s largest solar photovoltaic power plant. It has been built in the time that costs of the coal-fired Medupi and Kusile power stations, which are currently five years behind schedule, have nearly tripled.

But industry insiders are adamant that, if the policy uncertainty is not cleared up, the initial promise shown by the renewable programme will falter.

The department of energy was not available to respond to questions. http://mg.co.za/article/2014-11-20-nuclear-fixation-shafts-renewables

November 22, 2014 Posted by | politics, renewable, South Africa | Leave a comment

China joins the throng trying to flog off nuclear reactors to South Africa

China becomes latest country to sign SA nuclear accord http://www.moneyweb.co.za/moneyweb-south-africa/china-becomes-latest-country-to-sign-sa-nuclear-ac  Kevin Crowley, Bloomberg| 09 November 2014

Deal signed by Energy Minister Tina Joemat-Pettersson and her Chinese counterpart Wu Xinxiong.– South Africa, the continent’s second- largest economy and biggest power producer, signed a nuclear cooperation accord with China following similar agreements with Russia and France.

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The framework agreement, which is a precursor to procurement, was signed by South Africa Energy Minister Tina Joemat-Pettersson and her Chinese counterpart Wu Xinxiong, the Pretoria-based Department of Energy said today in an e-mailed statement.

South Africa is planning agreements with other countries including Japan as it decides how best to procure as many as 9,600 megawatts of nuclear energy by 2030. The country, which through its state-owned utility has installed capacity of about 42,000 megawatts, is struggling to meet power demand and on Nov. 2 had rolling blackouts, a consequence of decades of underinvestment in generation.

Companies that have expressed interest in building nuclear power plants in South Africa include France’s Areva SA and Electricite de France SA, Westinghouse Electric Corp., a unit of Japan’s Toshiba Corp., Russia’s Rosatom Corp., China Guangdong Nuclear Power Holding Corp. and Korea Electric Power Corp.

November 10, 2014 Posted by | marketing of nuclear, South Africa | 2 Comments

South Africa’s Cabinet not informed on nuclear agreements signed with France and Russia

secret-dealsflag-S.AfricaCabinet still not briefed over nuclear agreements Radebe, Business Day Live   BY PAUL VECCHIATTO, 07 NOVEMBER 2014, THE Cabinet, the government’s highest decision-making body, has not been briefed on the nuclear framework agreements signed with France and the Russian Federation……..Business Day, Sunday Times and the Council for the Advancement of the South African Constitution will together make an application under the Promotion of Access to Information Act (PAIA) requesting evidence of a record of decision to forge ahead with nuclear power plants.

The application will also request information on the protocols and processes followed prior to the signing of the agreements as well as for documentation on any affordability study into the commissioning of nuclear power plants.

An earlier PAIA application by the Sunday Times to the Presidency, Parliament and the Department of Energy for access to the framework agreement SA signed with Russia two months ago, was refused this week by the Department of Energy. The department said the release of the agreements would compromise the delicate negotiations that SA was holding with other countries.

The department said the agreements contained sensitive scientific and commercial information.

The Sunday Times now has 60 days to lodge an appeal on its first application with the department in order to change its decision.

The opaqueness of the decision to build nuclear reactors has caused consternation among observers, the suspicion being that the government has already struck a secret deal with the Russian Federation.

It is believed that the Cabinet has not made a formal decision to procure nuclear power stations, yet Department of Energy officials have insisted on several occasions “that a procurement will take place”.

Director of the council, Lawson Naidoo, said clarity was needed on the decision-making process to establish whether proper governance was followed. “I don’t understand how an international agreement can be signed (by the minister) without the approval of Cabinet. How does a minister get the authority to sign without the approval of Cabinet?”…….http://www.bdlive.co.za/business/energy/2014/11/07/cabinet-still-not-briefed-over-nuclear-agreements–radebe

November 8, 2014 Posted by | politics international, secrets,lies and civil liberties, South Africa | Leave a comment

Secretive deals between Russia and South Africa about buying nuclear technology

Russian-Bearflag-S.AfricaSecret nuclear deal talks held in KZN, news 24,  2014-10-24 Rowan Philp, The Witness Pietermaritzburg - Twenty of Vladimir Putin’s top nuclear experts pitched for South Africa’s biggest-ever deal – with an estimated R1 trillion price tag – at a secret meeting in the Drakensberg on Thursday.

The Witness can reveal that 50 South African experts – including its nuclear chief, Zizamele Mbambo – grilled officials from Russia’s state atomic energy company, Rosatom, at a secretive four-day conference at the Champagne Sports Resort.

secrets-liesSecrecy

 Officials initially denied that Rosatom was present, and the secrecy blanket included the omission of the firm’s name from all workshop materials.

However, a Witness reporter gained access to one key meeting for 15 minutes before being ejected, and also traced the name of the South African head of Rosatom to a chalet at the hotel. Rosatom officials pitched eight of their “VVER” pressurised water reactors for South Africa’s massive “nuclear build” programme.

It is intended to add 9 600 megawatts to the grid by 2030.

In an interview at the hotel, Mbambo said a French company was expected to pitch six of its slightly larger reactors at a similar conference.

The Russians were given the opportunity to present the first workshop in which to “parade” their offering, and France and China are set to follow later.

However, Mbambo revealed that other invited countries – including South Korea and the US – could potentially miss out on consideration if their presentations were not ready in terms of an unspecified deadline.

‘Window dressing’

Echoing the concerns of unions and accountability watchdogs, the DA last week alleged that the secretive workshops with various countries were “window dressing”, and that “all evidence points to a done deal with the Russians”.

This follows the revelation that President Jacob Zuma had struck a private agreement with Putin in August, and a statement by Rosatom in September that a deal for “actual joint construction” had been struck with the South African government.

The department of energy later said the statement had been “misunderstood”, and Mbambo on Thursday said: “No vendor has been chosen, and the procurement process has not yet begun.”………

The event was so secretive that the name “Rosatom” did not appear on any conference badges or place cards, and Russian officials also refused to confirm who they were when they were questioned about their identities.

But two members of the Russian delegation wore “Rosatom” golf shirts at the breakfast buffet, and The Witness established that Rosatom’s Vladimir Polikarpov was staying in chalet 27.

An energy department official later confirmed they were the bidding vendor………http://www.news24.com/SouthAfrica/News/Secret-nuclear-deal-talks-held-in-KZN-20141024

October 25, 2014 Posted by | secrets,lies and civil liberties, South Africa | Leave a comment

South Africa a juicy target for the nuclear reactor marketers

flag-S.AfricaState shops for ‘nuclear vendor’ IOL October 20 2014  Cape Town – The government has confirmed it is shopping around for its nuclear build programme and says it is consulting “nuclear vendors” in the US, South Korea, Russia, France, Japan and China.

 

marketig-nukes

The announcement by the Department of Energy yesterday comes weeks of controversy about the multibillion-rand nuclear project since it emerged last month that a R1-trillion agreement had been signed with Russia, followed by another with France.

The department said the government was consulting “nuclear vendor countries” with pressurised water reactor nuclear technology, similar to that used at Koeberg………

DA leader Helen Zille has said the nuclear co-operation agreement with France, signed by Joemat-Pettersson on Wednesday, is nothing more than a “decoy”.

“This is… to muddy the waters and divert attention from the Russian deal negotiated by President (Jacob) Zuma and signed by Minister Joemat-Pettersson last month.

“We are led to believe a similar agreement with the Chinese is next and that a proper procurement process has yet to begin, but all evidence points to a done deal with the Russians. No amount of obfuscation can allow our focus to shift from this.” – Cape Times http://www.iol.co.za/business/companies/state-shops-for-nuclear-vendor-1.1767746#.VEcGcSJ4pBE

October 21, 2014 Posted by | marketing, South Africa | Leave a comment

South Africa’s Treasury advised against getting Russian nuclear reactors, but Putin is pushing for the sale

Russian-Bearflag-S.AfricaVladimir Putin’s quest for a nuclear monopoly, Mail & Guardian, South Acfric17 OCT 2014 00:00 QAANITAH HUNTER  Somehow Russia has persuaded President Jacob Zuma into agreeing to a deal for a nuclear fleet that the treasury opposed. The Russians are coming. The nuclear deal with Russia is to dominate the agenda when the South Africa-Russia joint intergovernmental committee on trade and economic co-operation meets next month.

Even though the South African government insists it has not entered into the procurement phase for the nuclear fleet, it has become clear that Russian President Vladimir Putin managed to sway President Jacob Zuma and Energy Minister Tina Joemat-Pettersson into giving Russia the entirety of the deal.

Zuma and his most trusted Cabinet ministers went against the strict advice of the national treasury and his senior advisers when a nuclear energy “agreement” was signed with Russia last month.

Two sources who also advised against it revealed this week to the Mail & Guardian that an initial bid made by Russian nuclear company Rosatom last year was rejected by the treasury and a number of Zuma’s advisers. A third credible source who was close to the negotiations confirmed their version of events.

The treasury this week did not deny advising against the initial Russian proposal.

“Nuclear would be a substantial financial commitment and government can only make that kind of commitment after careful and thorough-going modelling and an affordability assessment,” said spokesperson Jabulani Sikhakhane.

He said they had yet to discuss how the treasury would pay for nuclear energy.

Exclusive rights
It has emerged that the Russians wanted exclusive rights to South Africa’s nuclear industry. This was substantiated by a statement made by Putin in March last year, ­following his visit to South Africa, saying his country did not want to merely build the nuclear plants but would bid to run the entire nuclear industry here.

South Africa plans to enhance its energy mix by creating 9.6 gigawatts of nuclear energy by 2030.

The M&G spoke to three highly placed sources – all of them indicated that:

  • The initial Russian proposal was not affordable and the treasury rejected it;
  • The technology proposed was sub standard and dangerous;
  • It would exclude and be damaging to local industries; and
  • Even public servants who seemed loyal to Zuma had concerns about it.

One source close to the nuclear talks said the signing of the agreement was a result of about two years of courting by the Russians……….http://mg.co.za/article/2014-10-16-vladimir-putins-quest-for-a-nuclear-monopoly

October 18, 2014 Posted by | marketing, Russia, South Africa | Leave a comment

France’s nuclear giant AREVA gets agreement to supply reactors to South Africa

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France and South Africa sign nuclear energy agreement  By Martine Pauwels, Cécile Feuillatre Paris (AFP) 14 Oct 14,  – Paris and Pretoria signed Tuesday an agreement which could open the way for French nuclear giant Areva to bid to build eight nuclear reactors in South Africa worth up to $50 billion (39.5 billion euros).

French Foreign Minister Laurent Fabius and South African Tina Joematt Pettersson signed an intergovernmental agreement on cooperation in nuclear energy development which is necessary for any commercial deal……..http://news.yahoo.com/france-south-africa-sign-nuclear-energy-agreement-133802965.html

October 15, 2014 Posted by | politics international, South Africa | Leave a comment

What a mess South Africa’s new ‘nuclear deal’ is in !

fighters-marketing-1flag-S.AfricaBid to stem fallout from nuclear ‘deal’ IOL. October 12 2014  By Wiseman Khuzwayo The apparent deficiencies in how the nuclear deal with Russia was handled have sent President Jacob Zuma’s office into overdrive in trying to contain the fallout from indications proper procedures had not been followed.

The nuclear build from this agreement reportedly will cost South Africa a record R3 trillion.

To stem the tide of criticism, Zuma’s spokesman, Mac Maharaj, said on Friday that the president had granted Energy Minister Tina Joemat-Pettersson authority to sign a similar agreement with the French government.

This is obviously the administration’s attempt to mitigate the fallout. Maharaj said Zuma had granted the same authority to the energy minister to sign the earlier controversial agreement with Russia.

On Wednesday, Beeld newspaper reported that Joemat-Pettersson had been alone when she signed the “mysterious” agreement with Russia.

According to the report, the rest of the South African delegation attending the general conference of the International Atomic Agency in Vienna was told to go and wait somewhere else because the meeting with Russia was “private”.

The announcement on September 22 followed a secretive trip to Moscow by Zuma and prompted allegations that the government was dodging procurement policies.

This then prompted officials from the Department of Energy to call a press conference to placate the critics………

Lance Greyling, DA spokesman on energy, said on Friday that Joemat-Pettersson and officials of Rosatom must, with urgency, appear before the energy portfolio committee.

He said they must account for what appeared to be a deal riddled with irregularities.

Greyling said in a bizzare attempt to deflect criticism regarding the secret agreement, Rosatom had blamed a poor translation of its statement as the cause of misunderstanding behind the agreement, disavowing its earlier claim of having been awarded the contract.

“The desperate move comes as South Africans express clear dissatisfaction with the lack of transparency surrounding the ‘agreement’, which is set to cost the fiscus nearly R3 trillion.”

The National Union of Mineworkers does not support the agreement. Its national executive committee said it believed there had to be transparency and a tendering process. http://www.iol.co.za/business/news/bid-to-stem-fallout-from-nuclear-deal-1.1763840#.VDyy_GddUnk

October 13, 2014 Posted by | secrets,lies and civil liberties, South Africa | Leave a comment

Russia’s Rosatom now denying that there is a contract with South Africa

questionflag_Russiaflag-S.AfricaNuclear deal was ‘lost in translation’, Business Day  BY SIKONATHI MANTSHANTSHA, OCTOBER 10 2014 ROSATOM, THE STATE-OWNED RUSSIAN NUCLEAR COMPANY, SPENT ON THURSDAY AFTERNOON TRYING TO DISOWN ITS EARLIER CLAIM OF HAVING BEEN AWARDED A CONTRACT TO BUILD SA’S PROPOSED FLEET OF POWER STATIONS.

The company blamed a poor translation for its late September statement in which, quoting South African government officials, it said it had been granted the right to build a fleet of nuclear power stations for SA.

The news that Russia would build nuclear power stations came as a surprise as no announcement had been made by the government that it had begun any tender process to procure the 9.6GW it said it would be actively seeking.

“The wording (in the statement) from Rosatom wasn’t well chosen,” said Viktor Polikarpov, regional vice-president for sub-Saharan Africa. “We have to admit that we worded the statement wrongly. It was lost in translation (from the original Russian).”

In this statement Rosatom quoted Energy Minister Tina Joemat-Pettersson. After going to ground and for days being unavailable to confirm the Rosatom claim, the Department of Energy eventually released a statement on its website, which was almost identical to Rosatom’s “translated” statement.

Following this, the department said the statement in no way confirmed SA had reached a deal with Russia. The agreement only envisioned possible future co-operation on nuclear energy issue……….

When Business Day asked for a copy of the co-operation agreement, Mr Polikarpov said the document “is classified … it is not available for public consumption”.

Mr Polikarpov was asked how Rosatom arrived at the $50bn price estimate for the project. After much discussion in Russian with Alex Kirillov, head of marketing in SA, he said this was the estimated cost of Rosatom’s plants……..

Rosatom will apply for a $50bn loan from the Russian government if SA chooses a build, own and operate model, he said……..http://www.bdlive.co.za/business/energy/2014/10/09/nuclear-deal-was-lost-in-translation

October 10, 2014 Posted by | politics international, South Africa, Spain | Leave a comment

Confusion over South Africa’s secret nuclear deal with Russia

Russian-Bearflag-S.AfricaNuclear Deal With Russia Brings Political Storm Clouds in South Africa VOA October 09, 2014  JOHANNESBERG, SOUTH AFRICA— Opposition lawmakers are crying foul about a multibillion-dollar nuclear power deal with Russia, saying the agreement could give Moscow the power to veto South African trade with other nuclear providers.The Sept. 22 strategic partnership, signed on the sidelines of the International Atomic Energy Agency conference in Vienna, comes as Moscow has sought to boost lucrative exports of nuclear equipment, technology and expertise in recent years…….

Lance Greyling, a top lawmaker with the opposition party Democratic Alliance, said there was confusion about the Sept. 22 deal. A draft agreement signed last year gave Russia the power to veto South African trade with other nuclear providers, party officials have said.

    “What the government is saying at the moment is that they’ve just signed a framework agreement with Russia and that there will still be a procurement process that is followed,” he told VOA on Oct. 3. “But what we are unclear about is what exactly is in this framework agreement, and the fact that they’re not willing to show it to us makes us highly suspicious.”…..
      If the government has nothing to hide in the deal then it needs to share details of the arrangement with lawmakers, Greyling said…….

http://www.voanews.com/content/south-africa-russia-nuclear-power/2478224.html

October 10, 2014 Posted by | politics, South Africa | Leave a comment

South Africa’s murky and uneconomic nuclear deal

secret-dealsflag-S.AfricaA nuclear deal as clear as mud October 7 2014  Cape Argus, By Jasson Urbach The decision to “go nuclear” in SA has more to do with politics than economics, writes Jasson Urbach.

South Africa is “going the nuclear route”, according to the Department of Energy’s acting director-general, Dr Wolsey Barnard. But given Eskom’s dire financial predicament, the government is opting for a “vendor-financed” option.

We should applaud the fact that Eskom, probably, will not be building South Africa’s next power station.

The delays and cost overruns associated with Medupi and Kusile demonstrate it’s not competent as a project manager for the building of such large plants.

However, the decision to “go nuclear” has more to do with politics than economics. Nuclear is costly – given the dramatic fall in gas prices, a private enterprise would not build a nuclear plant in the current operating environment. And nuclear will take too long to deliver – South Africa needs power sooner rather than later. Continue reading

October 8, 2014 Posted by | politics, South Africa | Leave a comment

South Africa’s present, and future, nuclear waste problem

wastes-1flag-S.AfricaNuclear waste is going nowhere slowly Mail & Guardian 03 OCT 2014 ANSIE VICENTESARAH WILD  Generations from now, there will still be no-go areas storing radioactive by-products of nuclear power production. In 300 years, South Africa’s Vaalputs nuclear waste site – a 10 000ha reserve in the dusty Northern Cape – will be opened for unrestricted use. Until then, it needs to be guarded and monitored; no small feat considering that if the 1820 British settlers had buried nuclear waste on their arrival, we would still be guarding the site.

About 100km from the town of Springbok, a warm wind raises dust from the ground, which has not seen rain in many months. Eight metres underground, concrete and metal drums containing low- and medium-level nuclear waste are biding their time, as the natural and sparse shrubbery reclaims the surface of the trenches they were buried in.

This is one of the major question marks over nuclear technology: What do we do with the waste?……….

the urgent question posed at the scientific forum in Vienna was what to do with the more dangerous high-level waste. For South Africa, with its plans to build a nuclear fleet to generate an additional 9 600MW of electricity, about 23% of the country’s power requirements, this issue is even more pressing.

Koeberg and Pelindaba’s high-level nuclear waste remains on site and is not moved. According to South Africa’s 2011 report to the Joint Convention on the Safety of Spent Fuel Management and on the Safety of Radioactive Waste Management, “used fuel from the Koeberg nuclear power station is currently stored in authorised used fuel pools on the site as well as in casks designed and constructed for storage of used fuel”………

“it is recognised that the current storage capacity at the Koeberg and Pelindaba sites [is] finite and the practice of storing used fuel on a reactor site is not sustainable indefinitely”.

So what will happen to the nuclear waste from the country’s proposed 9 600MW nuclear build?

Storage ‘pools’,…..

As Carl-Magnus Larsson, the chief executive of the Australian Radiation Protection and Nuclear Safety Agency, said: “We must remember that storage is an interim solution until final management and disposal … it remains a temporary measure.”….http://mg.co.za/article/2014-10-02-nuclear-waste-is-going-nowhere-slowly/

October 6, 2014 Posted by | South Africa, wastes | Leave a comment

Very worrying financial implications for South Africa’s nuclear deal with Russia

scrutiny-on-costsflag-S.AfricaNuclear urgency raises alarm, Mail & Guardian , South Africa  27 JUN 2014  LYNLEY DONNELLY The state seems set on going the atomic route despite the huge financial implications. Pressure to find a nuclear solution to South Africa’s power problems continues unabated, despite persistent concerns over its affordability.

Experts point out that nuclear vendor financing may be the way to fund the country’s nuclear ambitions, but there are unresolved legal and financial implications.

There is speculation in the energy sector that political pressure cost former energy minister Ben Martins his job, because he failed to secure a nuclear deal with Russia’s Rosatom.

Martins was replaced by Tina Joemat-Pettersson in President Jacob Zuma’s recent Cabinet reshuffle and goes back to Parliament as chairperson of the portfolio committee on public works……….

The apparent urgency about nuclear procurement runs counter to key government policies, specifically the National Development Plan, which calls for an in-depth investigation of the financial viability of nuclear procurement, and the draft update of the integrated resource plan (IRP), published last year. The document, which is government’s electricity planning road map, suggested that a nuclear decision could be delayed given revised projections of electricity demand.

Nevertheless, a decision about ways to procure nuclear power could be expected within the next two months, theMail & Guardian understands.

Elusive payment plan
The answer to how South Africa will pay for a planned 9 600 megawatts of nuclear capacity remains elusive. Eskom was named the owner and operator of new nuclear plants by the Cabinet, but it is in dire financial straits. It has declared a R225‑billion funding gap and has been placed on credit watch by ratings agency Standard & Poor’s………

The cost of nuclear energy could reach R1-trillion and faces competing energy investment demands.

Nuclear vendor financing models have been touted as a way to get around this, which Martins confirmed is the preferred model. “It was never the intention that South Africa would fund the entire nuclear programme. The stakeholders that have an interest in it would substantially fund the nuclear programme,” he said.

Ross Harvey, a visiting research fellow at the South African Institute of International Affairs, said a likely arrangement is that a nuclear vendor would build, own and operate a plant and take full responsibility for the financing.

Buy-back guarantee
In turn, an electricity buy-back guarantee by the government is the most likely way for the vendor to recover costs.

But it is not clear what legislative and tender processes would need to be in place to manage procurement, he said, and much more work is needed to create “legislative coherence” to govern a nuclear bid.

And, although this model would eliminate initial capital constraints, the government would still have to make good on a buy-back guarantee, Harvey said. It is also not clear that, in the time taken to complete a nuclear build programme, there would be sufficient electricity demand, supported by heavy industrial activity, to support such a guarantee. In addition, other technologies could rapidly develop to provide cheaper base-load power.

Rosatom is constructing a similar “build, own and operate” project in Turkey.

Harvey estimated that, based on Rosatom’s investment there, a Rosatom plant would cost between $5-billion to $7-billion, which is a “massive investment to recoup”. http://mg.co.za/article/2014-06-26-nuclear-urgency-raises-alarm?ars=true

September 27, 2014 Posted by | politics, South Africa | 1 Comment

Delays and impediments to South Africa getting Russian nuclear power plants

Russian-Bearflag-S.AfricaAnalysis: Why we won’t be getting any nuclear power plants from Russia anytime soon, Daily Maverick, DIRK DE VOS SOUTH AFRICA
25 SEP 2014
 
 The Department of Energy recently issued a statement regarding a new partnership in nuclear energy. But let’s not get excited. Nuclear power is a diversion from the real issues in the energy sector – and the culmination of a whole lot of dreaming. By DIRK DE VOS.

The recent media release issued by the Department of Energy, on the agreement regarding a strategic partnership in nuclear energy, will go nowhere.

We are advised that the agreement was signed between the Director-General of state-owned Rosatom but on behalf of the Russian government and Ms Tina Joemat-Pettersen, our minister of Energy, at the 58th session of the Atomic Energy General Conference. While the actual agreement is not available, the announcement reads that it “lays the foundation for the large-scale nuclear power plants (NPP) procurement and development programme of South Africa, based on the construction…of new nuclear power plants with Russian VVER reactors with a total installed capacity of up to 9,6GW (up to 8 NPP units)”.  It goes on: “Rosatom seeks to create in South Africa a full-scale nuclear cluster of a world leader’s level – from the front-end nuclear fuel cycle up to engineering and power equipment manufacturing.” (sic) It ends with the sentence: “This agreement opens the door for South Africa to access Russian technologies, funding, [and] infrastructure, and provides a proper and solid platform for future extensive collaboration”.

So, not that clear at all……..

 Already, the Rosatom view has been qualified with a senior government source tellinReuters “[t]hey jumped the gun” and Xolisa Mabhongo, an executive at South African state agency Nuclear Energy Corporation confirming that there would be a bidding process before any final contracts were signed.

The whole drive for nuclear power is very hard to understand, especially since it goes against the government’s own policy document, the Integrated Development Planwhich advises that commitments to long range, large-scale investment decisions “should be avoided” in order to ensure “decisions of least regret”. Nuclear builds take a long (a decade) to be completed and therefore do nothing to ease our current pressing energy problems. If nuclear were to get the green light, other shorter-term solutions would still be needed and then, when nuclear eventually comes online, we will find ourselves sitting with thousands of megawatts of excess and extremely expensive baseload capacity. ……….

…..Perhaps “jumping the gun” has something to do with the pressure Rosatom is facing from its various foreign nuclear power station builds, which it says amounts to $100 billion due to tighter economic sanctions imposed against Russia for its role in Ukraine’s civil war. This includes a $8.4-billion nuclear power project in northern Finland (where Rosatom has a 34% ownership stake) and a $10 billion nuclear plant expansion deal brokered between Rosatom and a Hungarian utility company. The Hungarian one is especially  interesting. It is reported that Benedek Javor, a Hungarian member of parliament, requested that the EU investigate Rosatom deal because he says that it secured its deal without a public procurement process in violation of EU regulations……….

Despite everything, nuclear energy is just uneconomic and will not solve our immediate energy problems either. Countries that select power supplies through democratic, transparent and market-based methods aren’t building new nuclear reactors. The cost differentials between nuclear energy and anything else can’t be fixed by sharpening pencils – the gulf is just too big. None of this means that we should not be vigilant. Rosatom’s footprints in Hungary and Turkey should be closely tracked.

Perhaps the biggest problem with our government’s apparent fixation with nuclear power is that it diverts attention away from the very many things in our energy sector that desperately require our attention. We can but hope that our decision makers will consult the IRP and put these nuclear dreams aside.DM http://www.dailymaverick.co.za/article/2014-09-25-analysis-why-we-wont-be-getting-any-nuclear-power-plants-from-russia-anytime-soon/#.VCXSO2ddUnl

September 26, 2014 Posted by | politics international, South Africa | Leave a comment

Financial problems for South Africa in planned nuclear deal

nukes-hungryflag-S.AfricaNuclear economist warns SA will ‘run into problems’http://www.bdlive.co.za/business/energy/2014/09/19/nuclear-economist-warns-sa-will-run-into-problems BY CAROL PATON, 19 SEPTEMBER 2014,  SA’s last tender to build nuclear power stations was canned in 2008 after credit rating agencies made it clear that they would downgrade Eskom to junk if it went ahead, Steve Thomas of the University of Greenwich said in a lecture on nuclear economics at the University of Cape Town on Thursday.

Details of Eskom’s nuclear tender in 2006 have not been fully disclosed, except that Eskom dropped it for being too expensive.

Eskom had expected a construction price of $2,500/kW but bids came in at $6,000/kW. It was also made clear, said Prof Thomas, that ratings agencies demanded “unconditional, timely guarantees” across all Eskom’s debt stock for it to maintain its credit rating.

Prof Thomas, visiting as guest of antinuclear lobby group EarthLife, said he expected SA’s nuclear endeavour to run into the same problems. Financing of nuclear projects had become highly risky and was regarded as credit-negative by ratings agencies.

“In the past, financing was not a problem. Utilities were blue-chip stock. They built plants and the costs were passed on to consumers. From a banking point of view this was ideal,” he said.

But accidents such as Chernobyl had led to increased costs in nuclear construction as additional safety measures must be included. Cost and time overruns had led banks to see nuclear power as too risky.

New regulatory approaches, in which prices are set by an independent regulator that assesses their fairness, have made it more difficult for utilities to pass on price increases to consumers.

“Of 70 nuclear power plants under construction, 50 are significantly late and the odds are against you to build to time and cost. So if banks won’t take the risk, then consumers must. But regulators are less likely to say consumers should sign a blank cheque. “For most countries that is not a viable option,” he said.

The remaining option was for taxpayers to provide the guarantees, should the nuclear vendor or utility go bankrupt.

n the UK, where a new plant is under construction at Hinkley Point, the British government has provided £10bn in loan guarantees, equal to 62% of the estimated cost.

“Unless SA consumers or taxpayers can guarantee the loan, a nuclear deal will not be financeable.”

September 20, 2014 Posted by | business and costs, South Africa | Leave a comment

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