South Africa: Nuke RFP Delayed in Order to Give Eskom Greater Say and Avoid Parliamentary Scrutiny http://allafrica.com/stories/201609300697.html By Gordon Mackay, 30 Sep 16 At a cabinet briefing today, Minister in the Presidency, Jeff Radebe, confirmed that it was highly unlikely that the nuclear RFP would be issued tomorrow as announced by the Minister of Energy, Tina Joemat-Pettersson, three weeks ago in Parliament.
Minister Radebe also suggested that the delay in issuing the RFP is largely due to a decision by cabinet to strip the Department of Energy of its role as government’s designated procurement agent in favour of Eskom.
This must be seen for what it is – a blatant attempt by the Zuma administration to:
- side-line parliamentary oversight of the nuclear new build programme;
- block public debate on the need for additional nuclear capacity;
- create a veil of secrecy around the procurement process which would now be subject to internal Eskom processes and procedures;
- give President Jacob Zuma greater control of the nuclear procurement process.
Designating Eskom as the procuring agent of the state will fundamentally limit the role and capacity of Parliament to oversee the nuclear deal and, in doing so, increase the potential of corruption surrounding the trillion rand deal.
The DA rejects any attempt to designate Eskom, headed by CEO and Zupta buddy, Brian Molefe, as the procuring agent for nuclear. Eskom has proven with Medupi and Kusile that it is unfit to manage mega-projects. It has also proven that its governance procedures are lax and the Supreme Court of Appeal has found its Board Tender Committee to be corrupt.
The DA is further concerned that the nuclear new build programme will further be subject to undue influence by the President, who is the Chair of the SOE Co-ordinating Committee.
We will use every mechanism available to us to ensure that this deal – which we do not need and cannot afford – is not pushed through without proper parliamentary oversight and scrutiny.
Signs of a great rift over Zuma’s nuclear programme, Rand Daily Mail, RAY HARTLEY 30 SEPTEMBER 2016 In another indication of President Jacob Zuma’s dimishing influence, his headlong rush to build a ‘fleet’ of nuclear reactors has been halted. And there are signs that it is going to be cut down to size, if it goes ahead at all.
This has drawn attention to South Africa’s status as a global model for renewable energy, and raises new question about why the country is pursuing nuclear when renewables look so promising.
South Africa has the fastest growing green economy in the world, according to credit rating agency Moody’s.
“South Africa was the continent’s largest renewables market in 2015 in terms of asset finance for utility-scale projects and it saw the highest year-on-year growth globally,” said Christopher Bredholt, a Moody’s vice president, in a Sept. 16 report. Asset finance is usually used by businesses to lease equipment without having to buy it outright, according to Finance & Leasing Association.
South Africa had the highest growth globally for asset finance in 2015 at 300 percent, representing $4.5 billion, according to Moody’s.
South Africa: Nuclear Plan On Ice As Eskom May Take Ownership AllAfrica.com 30 Sept 16 Early indications are that Eskom may ultimately be responsible for the management and implementation of South Africa’s nuclear plan and not the Department of Energy as had originally been planned.
At the same time the much anticipated request for proposal for the nuclear plan won’t be issued on Friday as mooted by Energy Minister Tina Joemat-Pettersson earlier this month.
Jeff Radebe, Minister in the Presidency responsible for Planning and Monitoring, reiterated at a cabinet briefing on Thursday that more consultations need to take place before a request for proposal (RFP) can be issued on 30 September 2016.
Joemat-Pettersson issued a statement a few hours after Radebe’s briefing, confirming this………..
At the time of the previous cabinet meeting on the issue of nuclear in December 2015, nuclear was going to be led by Energy,” Radebe said during question time on Thursday.
“But recently there are references made to Eskom. That’s why I’m talking about issues of consultation. Those types of consultations must unfold before the RFP is issued. The instituting authority must be clearly defined.”
State-owned nuclear firm Necsa could also play a bigger role in the process. “Necsa has had discussions with government officials and Eskom – and there are clear indications that Necsa will play a major role as the primary nuclear centre of the country,” Necsa chair Kelvin Kemm told Fin24 on Thursday.
Asked during question time if he meant that Eskom instead of the DoE would be driving South Africa’s nuclear build programme, Radebe responded, saying when cabinet previously deliberated on the nuclear process in December 2015, the decision was that the Department of Energy would be driving the process. “If there is a change it will have to come back to cabinet for deliberation,” he said.
Radebe also repeated that the RFP would not be issued on Friday, despite previous assertions by Joemat-
Pettersson that the RFP was due for Friday. “There was no contradiction,” Radebe said with reference to Pandor’s statement on Tuesday.
“My understanding is that what minister Pandor was saying, due to the processes of consultation [and the fact that] processes had not completed, the RFP will only be issued after all those issues of consultation have been concluded and being brought back to cabinet. So I do not envisage that tomorrow on the 30 of September the RFP will be issued by the Department of Energy,” Radebe said.Source: Fin24 http://allafrica.com/stories/201609300935.html
NO DEALS SIGNED YET ON SA NUCLEAR PROGRAMME – RADEBE http://ewn.co.za/2016/09/30/No-deals-signed-yet-on-SA-nuclear-programme Minister Jeff Radebe says the request for proposals will clarify if the country can afford nuclear power.Clement Manyathela | JOHANNESBURG – Minister in the Presidency Jeff Radebe says no deals have been signed for the nuclear build programme and says the request for proposals will clarify if the country can afford it or not.
Energy Minister Tina Joemat-Petterssen was meant to issue a request for proposals for the nuclear build programme as part of the procurement process today but this has now been postponed to allow more time for further consultation.
Radebe says the request for proposal will be issued after consultations.
“The Minister of Energy issued a statement confirming that the request for proposals is not going to be issued until such time that we’ve concluded those consultation processes.”
He says it will also advise government on whether or not it can afford nuclear power.
“That’s precisely the reason why the proposal is going to be issued in order to understand whether, as the country, we’re going to be affording it in terms of testing the market.”
Climate change is increasing the risk of war in Africa , Quartz, 30 Sept 16
United Nations secretary general Ban Ki-moon once described the war in Darfur, Sudan as the world’s first climate change conflict
, caused in part by the fighting over scarce water resources. Now, researchers believe climate change may be raising the risk of war across the continent.
In a study
published in Science
this week, researchers Tamma Carleton and Solomon Hsiang, both from the University of Berkeley, say that rising temperatures in sub-Saharan Africa since 1980 have raised the risk of conflict by 11%.
“Although climate is clearly not the only factor that affects social and economic outcomes, new quantitative measurements reveal that it is a major factor, often with first order consequences,” they wrote
in their study, which reviewed more than 100 other studies on the social and economic impacts of climate change.
South Africa will delay tendering for new nuclear power stations after requests for consultation and discussion made it impossible to start the process by the end of September as initially planned, the energy minister said on Thursday.
A statement said energy minister Tina Joemat-Pettersson remained “fully committed” to plans for nuclear procurement. http://www.reuters.com/article/us-safrica-nuclear-idUSKCN11Z1SW
Eskom may take charge of SA’s nuclear power build, IOL 29 September 2016, Emsie Ferreira Cape Town – Government will not be issuing a call for proposals for its nuclear power expansion programme to allow for more time for consultations, which could mean shifting responsibility for the project from the department of energy to Eskom, Presidency Minister Jeff Radebe confirmed on Thursday……..
Radebe was asked about conflicting statements from Energy Minister Tina Joemat-Pettersson and her science and technology counterpart, Naledi Pandor, as to whether the request for proposals from prospective partners would still proceed as planned on Friday.
Pandor this week indicated it would not, contradicting the energy minister.
But Radebe confirmed that government could not invite proposals while an integrated resource plan had not been finalised, and that Pandor had been right in saying Cabinet’s economic cluster first needed to meet to do so.
Eskom chief executive officer Brian Molefe last week told MPs and the media that concerns about whether the country could afford procuring the capacity to add 9,600 megawatt of nuclear energy to the grid were overwrought.
He said given the roughly 80-year lifespan of nuclear plants, the programme would pay for itself over those decades. Molefe was adamant that renewable energy could not be considered a viable alternative as it was not sufficiently reliable.
And earlier this week, Eskom’s head of generation Matshela Koko suggested that the nuclear utility could pay for the nuclear build programme because it would have accumulate cash reserves of R150 billion over the next decade.
The Democratic Alliance said on Thursday that allowing Eskom to lead the process would mean it being less open to parliamentary scrutiny, and President Jacob Zuma having greater control over the procurement process.
“Designating Eskom as the procuring agent of the state will fundamentally limit the role and capacity of Parliament to oversee the nuclear deal and, in doing so, increase the potential of corruption surrounding the trillion rand deal,” DA energy spokesman Gordon Mackay said. http://www.iol.co.za/news/politics/eskom-may-take-charge-of-sas-nuclear-power-build-2074416
WILL JOEMAT-PETTERSSON ISSUE REQUEST FOR PROPOSALS FOR PROCUREMENT OF NUCLEAR POWER? The request for proposals would mark the official start of South Africa’s nuclear build programme. Eyewitness News, Gaye Davis , 27 Sept 16 CAPE TOWN – Doubt has been cast on whether the request for proposals for the procurement of nuclear power will be issued on Friday as promised by Energy Minister Tina Joemat-Pettersson.
The request for proposals would mark the official start of South Africa’s nuclear build programme, which President Jacob Zuma has made a top priority but which has been shrouded in secrecy and is the subject of much controversy.
Science and Technology Minister Naledi Pandor says she doesn’t believe Joemat-Pettersson will be able to go ahead because the government’s Integrated Resource Plan (IRP) has yet to be updated.
The IRP forecasts the country’s energy demand, spells out generation plans and determines the required mix of energy sources.
Pandor was answering questions at a briefing by economics cluster ministers this afternoon.
Joemat-Pettersson told Parliament on 7 September the nuclear programme would kick off this Friday with the formal issuing of a request for proposals. But Pandor told journalists this afternoon she wasn’t certain the call for proposals could proceed this week.
Pandor says the next economics cluster meeting of Cabinet is set to discuss the versions of both the IRP, which projects energy demand and ways of meeting it, as well as the integrated energy plan – a kind of roadmap for energy provision………http://ewn.co.za/2016/09/27/Will-Joemat-Pettersson-issue-request-for-proposals-for-procurement-of-nuclear-power
Fears mount over true motivations for SA’s planned nuclear deal, Mail and Guardian, Hartmut Winkler 27 Sep 2016 Nuclear energy in South Africa is a very contentious issue. The decision on whether to proceed with the construction of a fleet of nuclear power plants is destined to become the financially most far-reaching and consequential defining moment of the Jacob Zuma presidency.
There is widespread public mistrust of the nuclear expansion process. Its roots lie in the extraordinary announcement in 2014 that the Russian nuclear agency Rosatom had secured therights to build the new South African nuclear plants. The South African government played down the announcement, claiming that it was inaccurate.
But this precipitated a series of media investigations. These uncovered evidence that individuals close to the president and groups linked to the ruling ANC have significant financial interests in the matter.
Civil society organisations are taking government to court in an attempt to have the deal declared illegal. Their attempts to have details of the Russian agreement released are being resisted. This is likely to strengthen their case, and sway public opinion further.
It appears that those with a stake in the nuclear build are hoping to fast-track the process in the face of growing public opposition. This is evident from revelations that, bizarrely, contracts are being awarded, even though a formal process has not been set in motion by government.
The most recent revelation was that a member of a business family with close links to President Jacob Zuma has been awarded a massive R171 million tender
for a nuclear build programme management system.
The meaning of this is unclear. It has largely confirmed the fears that the nuclear build is being driven for the benefit of the politically connected rather than the national good.
The debate surrounding the nuclear project centres on three highly contested questions:
- Is the country’s future energy generating potential and demand such that an expensive nuclear power station build is effectively unavoidable?
- Can South Africa afford the associated costs and debt, especially in view of massive funding demands in other sectors such as education?
- If approved, would the nuclear build lead to massive overspends, corruption and beneficiation ofpolitically connected individuals?…….
it is difficult to understand why the renewable fraction is not being increased further, and why the national power utility Eskom, under the leadership of Brian Molefe, a nuclear disciple, now opposes new renewable energy developments.
The promotion of nuclear energy at the expense of renewables bucks global trends………
The ANC’s internal nuclear war
The often obscure processes and overhasty developments require an insight into the present machinations within the governing party.
Tensions within the ruling party have escalated to the point where calls for the president’s resignation are now made openly. And even party leaders acknowledge that factions in their ranks are thriving on corruption.
The organisational fracture is equally evident in attitudes towards the nuclear build. Tensions over the issue have been cited as the major reason for Zuma’s dismissal of the financially prudent former Finance Minister Nhlanhla Nene in December 2015.
The official position…….
the legitimacy of the procurement process has already been undermined.
Looking ahead, actual construction would need to be preceded by the closure of funding agreements, the settling of legal disputes and further public engagement. This takes time.
In the unlikely event that the nuclear build actually does come to fruition, it will not commence any time soon.
Hartmut Winkler, Professor of Physics, University of Johannesburg
This article was originally published on The Conversation. Read the original article. http://mg.co.za/article/2016-09-27-questions-mount-over-south-africas-planned-nuclear-power-deal
Nuclear corporation’s spending comes under scrutiny of Auditor-General, Times Live, Linda Ensor | 27 September, 2016
The Nuclear Energy Corporation of SA (Necsa) incurred R128 million in irregular expenditure in its 2015 financial year because it failed to comply with the government’s preferential procurement regulations‚ the Auditor-General has found.
The annual report of Necsa‚ which processes nuclear material and undertakes research and development in the nuclear field‚ was tabled one year late in Parliament on Tuesday.
Necsa management and its board are currently being investigated by a task team appointed by Energy Minister Tina Joemat-Pettersson. The investigation related to “serious mismanagement”‚ the auditor-general said in his report‚ included in the annual report.
The board has been wracked by division and court battles with CEO Phumzile Tshelane put on a suspended suspension last year. No mention of these post-budget developments were made in the annual report.
The auditor-general’s report‚ which was included in the annual report‚ said the full extent of the irregularities was only quantified by the end of March 2016. The Necsa board condoned the irregularities.
Despite the auditor-general’s reservations‚ Necsa received an unqualified audit opinion on its financial statements.
The auditor-general noted that management did not take effective steps to prevent irregular expenditure and fruitless and wasteful expenditure. Non-compliance could have been prevented had compliance been properly reviewed and monitored.
The auditor-general also cast doubt on the going-concern status of the state-funded entity‚ which made a R21m net loss in the 2015 financial year…….
The state funded Necsa to the tune of R580m in 2015 and R599m in the current year.
– TMG Digital/BDLive http://www.timeslive.co.za/local/2016/09/27/Nuclear-corporations-spending-comes-under-scrutiny-of-Auditor-General
‘Eskom’s nuclear build cost and running projections are overheated’ – Analyst SUNDAY TIMES BUSINESS BY ASHA SPECKMAN, 2016-09-25 The price at which Eskom is projecting it will deliver nuclear energy as part of the proposed nuclear build has been rubbished by energy analysts who say South Africa could end up paying much more.
The power utility is targeting R1 per kilowatt-hour for nuclear energy – and this week Eskom’s head of generation, Matshela Koko, said the state-owned company expected to be able to fund the nuclear build programme from its own cash resources.
But energy analysts have scoffed at this, saying cost studies and examples from other projects show the bill to be massive. At the rate proposed, the project would not be viable.
Frank Spencer, an independent analyst, said: “If it comes in at R2/kWh or even R1.50/kWh, it would make absolutely no sense to pursue from a commercial perspective.”
The government and private sector’s expectations of the costs are miles apart.
Eskom spokesman Khulu Phasiwe said projections that the power utility had done put the cost of additional nuclear power at R500-billion. But Spencer estimated the cost would be about R1-trillion……..
He said decommissioning costs associated with dismantling nuclear power stations in future were often omitted from modelling, which eventually inflated the cost of the project.
“I think the expectations are based on what we’re seeing in the UK – [but] the cost of energy let alone the cost of the build programme, and finally what the levellised cost of energy works out to once all of those costs are taken into account, will be significantly higher than that.”…….
Eberhard said: “Nuclear vendors promise low prices but inevitably there are significant cost and time overruns. If these prices are not fixed in a contract then consumers end up with very expensive electricity.”
He cited the Hinkley C facility, where a 35-year contract for the equivalent of R1.65/kWh has been signed, as an example of a contract secured at a low rate……..
Last week, Moody’s placed Eskom’s credit rating on review for downgrade, saying that future tariffs may be affected due to the ongoing growth of independent power producers and a regulator that is hostile to Eskom’s tariff increase requests.
The agency also noted that institutional investors were beginning to display risk aversion to funding state-owned companies…….firstname.lastname@example.org http://www.timeslive.co.za/sundaytimes/businesstimes/2016/09/25/Eskoms-nuclear-build-cost-and-running-projections-are-overheated—Analyst
The nuclear killer lurking in our midst, Pambazuka News Gerard Boyce Sep 22, 2016
South Africa’s nuclear programme will be a disaster. Besides the fallouts being witnessed in the jostling for gains by greedy politicians, the project is likely to gobble up huge amounts of public funds that will be difficult to account for as the government will cite national security concerns of nuclear power, thereby curtailing citizens’ right to accountability.
Nuclear power kills. If ever one had any doubts about the truthfulness of this statement, the past few months in South African politics have surely dispelled them. During this time, the government’s nuclear plans effectively killed the political career of former Finance Minister Nhlanhla Nene whilst indications are that the career of current Finance Minister Pravin Gordhan will soon suffer the same fate. It has slain any semblance of unity in the upper echelons of the ruling African National Congress. It is rumoured that the public spats in which members of various ruling party factions are engaged and that have come to hog national headlines each week are a result of ongoing palace intrigue that is caused by their jostling for position which will enable them to secure the maximum benefits from the potential bonanza that awaits when tenders for the construction of nuclear plants are awarded.
The open hostility exhibited by erstwhile comrades has exposed as a sham the image of a strong and united party and revealed a picture of an organisation riven by factionalism and bitter internal disputes. It is widely predicted that, if this deal is pushed through (as current indications are that it will), the country’s credit rating will be downgraded to junk status. A downgrade will likely plunge the economy into a coma and cause it to be put on life support………
it can become relatively easy for governments to be drawn into continuing to invest in their nuclear programmes even if they see little or no justification for doing so. One has only to observe the decades long (and seemingly never-ending) construction periods of many nuclear plants internationally for evidence thereof. Needless to say, this set of circumstances provides the ideal conditions in which graft and patronage networks are able to thrive and is likely to increase both the opportunity and propensity for certain individuals to engage in corrupt practices.
Secondly, given the destructive purposes to which nuclear technology can be put, a raft of laws and regulations have to be passed in order to prevent this technology falling into the wrong hands. Since each reactor is potentially a national calamity, policymakers justify these regulations as being necessary to protect the welfare and safety of citizens. These laws also serve to provide convenient cover behind which the less than savoury aspects of these deals can be hidden.
To shore up this cover, the global nuclear industry seems to have a built-in failsafe against closer public scrutiny and unwanted attention in that, once established, stakeholders in the industry can always appeal to the nebulous concept of the ‘national interest’ in an attempt to conceal their actions from the public. By elevating every investigation of their operations to a potential national security concern, they are able to shield their operations from investigation and thus to avoid criticism. Arguably, this has the effect of lowering the degree to which this industry feels accountable to the public since being open to investigation and subject to criticism (and thence learning) forms the basis of public accountability…….. Dr Gerard Boyce is a Senior Lecturer in the School of Built Environment and Development Studies at the University of KwaZulu-Natal. He writes in his personal capacity. http://www.pambazuka.org/human-security/nuclear-killer-lurking-our-midst?utm_campaign=shareaholic&utm_medium=twitter&utm_source=socialnetwork
Eskom’s R150 billion cash-reserves claim is wishful thinking – Natahsa Mazzone http://www.politicsweb.co.za/politics/eskoms-r150-billion-cashreserves-claim-is-wishful- Natasha Mazzone | 23 September 2016
DA says power utility’s profit of R4,6 billion a far cry from the R15 billion need a year to make up amount. The claim by Head of Generation for Eskom, Mr Matshela Koko, that Eskom could pay for the nuclear build programme by using cash-reserves, which he indicated could be R150 billion in 10 years’ time, is wishful thinking.
Eskom recorded a R4.6 billion profit in the 2015/16 financial year, a far cry from the R15 billion in profits it would need to generate consistently for the next 10 years to make up R150 billion.
Considering that by Eskom’s admission electricity demand is down, coupled with economic growth projected at a mere 0.6%, this raises serious questions about the assumptions underlying their projections.
I will therefore be submitting parliamentary questions to Eskom to find out how they intend to generate these massive cash reserves.
The validity of their projections notwithstanding, spending any cash reserves on a nuclear build program would be financially irresponsible. Eskom currently owes its creditors R322 billion underwritten by R350 billion in government guarantees. The entity should rather use excess cash reserves to decrease these liabilities.
Moreover, the fact that Eskom believe they can generate these massive profits whilst pushing for well-above inflation tariff increases on electricity, should be a slap in the face of the majority of poor citizens in our country. Energy and electricity costs are eating into their limited budget and now with these tariff increases, their pockets will be hurting even more.
The big question is why Eskom needs to be building nuclear in the first place when future electricity shortages would be better addressed by cheaper and more sustainable renewable and gas projects. With advancements in storage and battery technologies, these would be the better alternative by 2035.
The Minister is the only person with the prerogative to choose nuclear over any other form of energy, in this vein Mr Koko is overstepping his fiduciary duties to even suggest that Eskom would be investing in Nuclear.
In the context of its massive debt, and repeated requests for above inflation tariff increases, it is irrational to utilise any cash reserves in pursuit of the much maligned nuclear “wonder” programme and once again calls the motivation for the nuke deal into question.
Issued by Natasha Mazzone, DA Shadow Minister of Public Enterprises, 23 September 2016
Activists seek to bar plan by South African government to expand nuclear power http://af.reuters.com/article/southAfricaNews/idAFJ8N1BD01Z CAPE TOWN, Sept 22 (Reuters) – Activist groups are challenging a plan by South Africa’s government to expand the country’s nuclear power generation capacity on the grounds that the process was unconstitutional, they said on Thursday.
Earthlife Africa Johannesburg and the Southern African Faith Communities Environment Institute said in a statement that the High Court in Cape Town would hear their case on Dec. 13 and 14 this year to block plans to add 9.6 gigawatts of nuclear power. (Reporting by Wendell Roelf; Editing by James Macharia)