Uranium is the dirty underbelly of nuclear – scientist http://www.engineeringnews.co.za/article/uranium-is-the-dirty-underbelly-of-nuclear-scientist-2016-07-21 21ST JULY 2016 BY: NEWS24WIRE Anti nuclear sentiment tends to focus onnuclear waste or operational risks, but more focus should be on the “dirty underbelly” of uranium mining, according to a science adviser.
“Whenever people get excited about nuclear power stations, they kind of forget where the actual uranium comes from,”Dr Stefan Cramer, science adviser for environmentalist groupSafcei, told Fin24 in an interview recently.
“Nuclear is a fallacy, both economically and environmentally,” Cramer, who was born in Germany but not now lives in Graaff-Reinet, claimed.
“Uranium mining is the dirty underbelly of this whole nuclearcycle,” he said. “It’s where it all starts.”
“One must stop nuclear industries in (their) tracks because it leaves future generations with an immeasurable task and legacy,” he said. “The best point to start is at the source, where the whole cycle of nuclear technology begins, and that is at uranium mining.
“Uranium mining is very much the dirtiest part of the entire industry.”
Anti-uranium mining boost Cramer’s focus on anti-uranium mining was given a boost this month when Australian company Tasman Pacific Minerals Limited said it is downsizing its mining application in South Africa by almost 90%.
“Overall, the area covered by Tasman’s new and existingmining right and prospecting right applications in the Western and Eastern Cape will reduce by almost 300 000 ha to approximately 465 000 ha,” it said.
Tasman is punting job creation as necessitating the success of its new application. “Currently very few opportunities for additional economic development exist,” it said in a recent report.
“Tasman believes that uranium mining has a significant role to play in improving the economic outlook of the region, not only from an employment perspective, but also in the economic activity that is generated by associated businessactivities that extend beyond mining itself.”
“We desperately need jobs in the Karoo,” he said. “The Karoo is an area of high poverty, (with) very low employment opportunities. Any opportunity is usually highly welcome and it is to be welcomed because we need jobs desperately. Buturanium mining is a very poor process to create jobs.
“If we are really serious about job creation in the Karoo, there are other opportunities, which are much more valuable.
“Agriculture is still the main employment opportunity and needs to be protected and improved. Agri-tourism is a very new and very fast rising opportunity, but the best (opportunity) of all is renewable energy.”Renewable energy jobs boost
“South African already has 28 000 jobs in the renewable energy industry as compared to 2 600 in the nuclearindustry,” said Cramer. “Even the most ambitious job projections in the nuclear field would be up to 30 000 jobs if they whole country is run onnuclear energy. If we go into renewable energies, it’s an order of magnitude.
“The Department of Energy predicts up to 350 000 jobs inrenewable energy, so uranium mining is clear(ly) not a good strategy,” he said.
Cramer said nuclear is also a fallacy from a democratic point of view, “because it creates a veil of secrecy over this whole industry”. “That is clearly shown in our court case against the South African government for its failure to disclose the contents of an agreement with Russia,” he said.
Should the cost of nuclear energy come in too high compared to other technologies, then the nuclear build programme, which is championed by President Jacob Zuma, could be blown out of the water.
The IRP is a 20-year plan that estimates demand, plans for supply, and makes policy decisions on the energy mix based on a range of factors, including energy security and affordability. Regular updates to the IRP — every two years — are crucial to ensure energy security and prevent overbuilding capacity.
In the latest draft, being drawn up by technical experts based at Eskom on behalf of the Department of Energy, the overnight cost for nuclear energy is said to have been estimated at $6,000/kW.
The number comes from several industry sources, who are privy to the information, but was not confirmed by the government. Overnight costs include construction costs, but exclude interest…..
In previous drafts of the IRP, overnight costs for nuclear were estimated at $5028/kW in 2010, and $5800/kW in 2013. The 2013 IRP, which cautioned against nuclear energy due to lower than expected demand and the high risk involved, has never been adopted by the Cabinet.
At the time, it was speculated that the Department of Energy held it back, as it was not nuclear-friendly enough. Instead, the government has continued to use the 2010 IRP, despite its outdated assumptions and modelling, and a wide acknowledgement in the energy industry that its credibility is shot.
The IRP process under way right now is a new attempt to update the plan, which is six years out of date.
But since the modelling team submitted its draft to the department earlier in 2016, the process appears to have stalled. Energy Minister Tina Joemat-Pettersson said in September that the new IRP would be completed by March. But the draft is far from finished, and public consultations — which should take place under the policy framework — are still far from a reality……
Nuclear sector in crisis as SA weighs options, Business day Live, BY MARK ALLIX, 15 JULY 2016 THE world nuclear industry status report for 2016 may give SA pause for thought about its ambitions to build nuclear power capacity.
The report says the global nuclear industry is in crisis, and renewable energy is taking over……
SA’s government is adamant that nuclear will be part of the energy mix, and of the country’s commitments to cutting carbon emissions. Existing solar and wind energy technologies cannot cater for base-load electricity demand to run modern industries, it says.
Safety and the funding of huge initial financial costs for nuclear reactors remain critical factors, despite the promise of lower carbon emissions, and ultimately, much lower electricity retail costs. Costs of up to R1-trillion have been estimated for SA’s proposed 9,600MW of nuclear power.
Knox Msebenzi, MD of the Nuclear Industry Association of SA, said on Thursday it was difficult to obtain an authoritative figure. The association, whose members included potential nuclear bidders, had not made an independent estimation of what such a project would cost.
“There are a lot of variables, which if not defined, could push the price up or down,” he said.
Project cost estimations could use typical industry accepted valuations. But despite including plenty of local content such as concrete and steel, costs were also subject to possible litigation over projects and exchange rate volatility for imported technologies.
Silas Zimu, the special energy adviser to President Jacob Zuma, said earlier in July that SA would have to build nuclear power plants on a piecemeal basis, according to what it could afford. It would also need to purchase the best technology, amid huge delays in the global nuclear industry…..http://www.bdlive.co.za/business/energy/2016/07/15/nuclear-sector-in-crisis-as-sa-weighs-options
SA backs India to join Nuclear Suppliers Group enca, SOUTH AFRICA Friday 8 July 2016 PRETORIA – South African President Jacob Zuma agreed on Friday to support India’s controversial bid to join the Nuclear Suppliers Group (NSG), an international body that controls commerce in nuclear materials and technology.
Indian Prime Minister Narendra Modi announced this at a joint press conference at the Union buildings in Pretoria on Friday after meeting Zuma.
He thanked Zuma for his promise of support in the meeting….
- The bid is controversial because all the current NSG members, including South Africa, are also members of the NPT, the Nuclear Non Proliferation Treaty, which restricts the possession of nuclear weapons to the five major powers, the US, UK, France, Russia and China.
India acquired nuclear weapons in 1974 and so could not join the NPT, which it in any case did not want to because it regards it as discriminatory.
When she was asked earlier this week about this, International Relations and Cooperation Minister Maite Nkoana-Mashabane noted that all current NSG members were also members of the NPT. But she also hinted that in his one-on-one meeting with Modi, Zuma might lend his support to India’s bid…….https://www.enca.com/south-africa/sa-backs-india-to-join-nsg
Bullish Areva wants in on SA’s nuclear tender, City Press Yolandi Groenewald 2016-06-10 France’s state-owned nuclear businesses are focused on winning the lucrative South African nuclear tender despite recent financial difficulties.
The French will bid as EDF/Areva – nuclear technology company Areva sold its reactor business to the state-owned energy utility EDF earlier this year……..
EDF was facing large investments at its French operations. Its investment compromised about €50 billion (R869.6 billion) over 10 to 15 years, which would extend the operating lifespan of its ageing fleet to 60 years……
The French nuclear industry has faced a number of storms during the past year. Areva teetered on the edge of bankruptcy after years of losses wiped out its equity. It was rescued by French state aid and a sale of its reactor business to EDF.
The Flamanville project in France, Areva’s first European Pressurised Reactor (EPR) nuclear pressurised water reactor, is years behind schedule, way over budget and riddled with technical difficulties…….
France, Russia, China, the US and South Korea are competing for what could be South Africa’s biggest procurement project. The contract, estimated to cost between R580 billion and R1.56 trillion, aims to add nuclear capacity of 9 600 megawatts.
The government has said the nuclear programme would be developed at a pace the country can afford……..http://city-press.news24.com/Business/bullish-areva-wants-in-on-sas-nuclear-tender-20160603
South Africa’s Energy Minister again misses legal deadline to file nuclear procurement papers for the High Court
Joemat-Pettersson misses third deadline to file papers in nuclear case http://www.bdlive.co.za/business/energy/2016/06/03/joemat-pettersson-misses-third-deadline-to-file-papers-in-nuclear-case
BY CAROL PATON, ENERGY Minister Tina Joemat-Pettersson has missed a third deadline to file papers to oppose an application by the SA Faith Communities Environmental Initiative (Safcei) and Earthlife Africa to have the proposed procurement of nuclear energy declared unconstitutional.
The two groups filed papers in October asking the High Court in Cape Town to rule that government had failed to meaningfully consult the public on the nuclear procurement.
They will also argue that the inter-governmental agreements on nuclear procurement signed with Russia, France, China and the US are illegal as they were not preceded by a determination in the government gazette by the minister.
Safcei and Earthlife Africa said on Friday that this was the third deadline that Joemat-Pettersson had missed in as many weeks.
Government failed to respond by the May 13, and asked for an extension until May 30. Earthlife and Safcei then instructed their lawyers to issue a rule 30A notice, which gave the government until the May 31 to respond.
“On Tuesday June 1, our attorneys were advised that the answering affidavit has been drafted, is currently being reviewed by the Office of the Presidency, and that the State Attorney hopes to be in a position to file it on or about June 7,” they said in a statement.
If this latest deadline is missed, the Safcei/ ELA legal team will approach the courts to force government to comply with the legal time frames. Failing this they will ask the courts to strike out the government defence and for their application to be unopposed.
“We believe that this consistent failure to comply with the legal time frames points to an unaccountable government,” says Liz McDaid, Safcei spokeswoman.
How the state capture controversy has influenced South Africa’s nuclear build , Sunday Times, 29 May 16 South Africa is facing a critical decision that could see it investing about R1 trillion – or US$60 billion to $70 billion – in a fleet of new nuclear power stations. Proponents argue that it will greatly increase electrical base-load capacity and generate industrial growth. But opponents believe the high cost would cripple the country economically.
What should be an economic decision has now been clouded by controversy, with political pressure to push through the nuclear build and the increasingly apparent rewards it would bring to politically linked individuals.
The nuclear expansion programme needs to be considered exceptionally carefully given that the required financial commitment is roughly equal to the total South African annual tax revenue. Loan repayments could place a devastating long-term burden on the public and on the economy as a whole……..
South Africa has had remarkable success with speedy, cost-effective installation of renewable energy power plants. In addition to this, technologies for harvesting South Africa’s plentiful wind and solar energy resources are rapidly becoming cheaper, raising the question of whether the country should not invest more in these options rather than in going nuclear.
The argument that nuclear energy provides a stable base load, independent of weather conditions, is mitigated by improvements in energy storage technologies……
Zuma and the Russians The nuclear debate gained a political dimension when President Jacob Zuma and his Russian counterpart, Vladimir Putin, started to develop an unusually close relationship. It culminated in an announcement that the Russian nuclear developer, Rosatom, had been awarded the potentially highly lucrative contract to build the new reactors. The agreement was later denied.
Rosatom was considered the preferred contender, with other bidders only there to lend the process legitimacy, according to some observers. The lack of transparency surrounding the process, coupled with a history of corruption in South African mega-projects like the arms deal, has made the whole scheme seem suspicious to the broader public.
A thickening plot
A crucial thread in this saga involves the Shiva uranium mine, about 30km north-west of Pretoria, the country’s executive capital. It originally belonged to a company called Uranium One, a subsidiary of Russia’s Rosatom. It was sold in 2010 to Oakbay Resources, a company controlled by members of the politically connected Gupta family and the president’s son, in a deal that greatly surprised economists.
The mine was deemed unprofitable and thus unattractive to other mining companies. But it was still considered worth a whole lot more than the R270 million paid by Oakbay. The mine would, however, become highly profitable if it became the uranium supplier to the new nuclear power stations. Oakbay and its associates therefore have a very strong incentive for this nuclear build to happen.
It is here that the nuclear build drama feeds into the recent major controversy surrounding alleged state capture, meaning a corrupt system where state officials owe their allegiance to politically connected oligarchs rather than the public interest. This was highlighted by the shock dismissal of Finance Minister Nhanhla Nene, a reported nuclear build sceptic, but also by subsequent allegations of ministerial positionsbeing offered to people by members of the Gupta family.
Political, legal and civil opposition
The nuclear build’s association with the Zuma faction in the ruling African National Congress (ANC) will be a political hot potato for decades to come. ……
A negative nuclear outlook
Building these plants is a risky business proposition, especially for Rosatom, which is implicated in the developing scandal. The recent political mood swing against state capture and a likely credit rating downgrade add to the risk.
Rosatom has suggested a nuclear build financing option that effectively amounts to it providing a loan. It is, however, conceivable that a future government may not honour debt repayments if there is a view that the construction deal was secured irregularly.
The narrow public support base and downright hostility in some quarters to a nuclear build has already effectively stalled local nuclear construction plans. The level of controversy, high costs and potential for further disruption mean that the planned implementation could only proceed under severe social strain.
Such a scenario could very well cost the ruling ANC the 2019 national elections. And the party is becoming increasingly aware of this. As such, it is posited that the nuclear build will not happen any time as soon as planned.
– Hartmut Winkler, Professor of Physics, University of Johannesburg http://www.timeslive.co.za/sundaytimes/opinion/2016/05/27/How-the-state-capture-controversy-has-influenced-South-Africa%E2%80%99s-nuclear-build
Govt misses deadline to open up alleged Russian nuclear deal http://businesstech.co.za/news/energy/124645/govt-misses-deadline-to-open-up-alleged-russian-nuclear-deal/ By News24Wire May 24, 2016 The government must respect the rules and commit to following the timeframes, leading environmentalists said after the state once again failed to submit answering affidavits in the court case regarding its nuclear energy agreement with Russia.
Earthlife SA and the Southern African Faith Communities’ Environment Institute (Safcei) claim that Energy Minister Tina Joemat-Pettersson acted unconstitutionally in not submitting the government’s nuclear deal with Russia to Parliament.
Following the Department of Energy (DoE) and Joemat-Pettersson’s failure to meet the original May 13 deadline to submit answering affidavits, the State Attorney on Monday said they could also not meet the 20 May Rule 30A notice deadline, a rule that prohibits further delays.
“Unfortunately the first and the second respondents are still not in a position to file answering affidavits and are still in the process of drafting same,” the State Attorney’s office said in a letter to the environmentalists on Monday.
“As already pointed out the respondents have difficulty in finalising their answering affidavits due inter alia to the bulk of the founding affidavit, as supplemented, the complexity of the application as well as the importance thereof for all parties concerned. The incomplete draft already runs to more than 200 pages.
“The first and the second respondents will endeavour to have their answering affidavits finalised in terms of the provisions of the notice … by Tuesday, 31 May 2016.”
Safcei spokesperson Liz McDaid said on Monday that “it is not unexpected that government once again fails to meet their own deadlines”.
“But what is of concern is that government lawyers are even not committing to the legal rule 30a notice deadline, but only going to ‘endeavour’ to meet it.
“If the country is to function as a democratic state under the rule of law, then the state must respect the rules and commit to following the timeframes, which are set out under the law,” she said.
In October last year, Earthlife Africa JHB and Safcei filed court papers challenging the constitutionality of the intergovernmental framework agreements the DoE signed with Russia, China, South Korea and the USA on the country’s planned nuclear development.
Safcei said it waited for Joemat-Pettersson to provide the records of the decisions that are being challenged. “In that period, Safcei and Earthlife Africa generously allowed the government extensions, which eventually meant that government only provided the requisite documents on February 16 2016.”
Legal documents indicate that South Africa did sign a nuclear deal with Russia, claim the environmentalists in their affidavit.
Here, they said “the Russian agreement was entered into unlawfully, but makes (an) internationally binding commitment to buy a fleet of nuclear reactors from Russia”.
From the state law adviser’s explanatory memorandum that was prepared in November 2013 but only revealed recently to Safcei/ELA, “it is evident that the Russian agreement is to build reactors and an enrichment plant”, the group said.
They said other subsequent agreements would “cover the details of how it is to be financed, not if it would go ahead”. The court case appears to be stalling the country’s bid to launch its request for proposals for the 9.6GW nuclear procurement programme. This was supposed to occur on April 1.
How Russia Is Expanding Its Vast Nuclear Empire Into Africa, AFK Insider By Dana Sanchez May 19, 2016, Russia’s government-owned nuclear agency Rosatom hopes to use South Africa as a springboard into the rest Africa as it seeks to expand its influence on the continent by building nuclear power plants.
Rosatom plans to sign framework cooperation agreements with Kenya, Uganda and Zambia, adding to those already made with South Africa, Nigeria and Ghana, Reuters reported.
Right now, South Africa may be the best prospect. Nigeria looks less likely as its economy contracts in the global oil price plunge.
“Given the extremely bad economic situation in Nigeria today, it might take a bit longer. But the government and the new president are still determined to go nuclear,” said Viktor Polikarpov, Rosatom’s vice-president of sub-Saharan Africa.
South Africa in 2015 approved a plan to develop up to 600 megawatts of nuclear capacity by 2030 as part of a bigger plan to build 9,600 megawatts of nuclear power at up to nine new nuclear reactors……
Environmental activist group Greenpeace warned the ANC in 2015 to abandon nuclear build plans or face massive resistance, NuclearNews reported.
“The ANC needs to know that if it does go for the nuclear option as part of the (energy) mix, then they are on a collision course with the broader spectrum of the South African civil society,” said Greenpeace Director Kumi Naidoo said on Monday that the ANC should “take nuclear off the table.
Russia has competition to do the nuclear build from China, France and South Korea, Reuters reported. It’s already planning to seek more deals across the region that range from building power plants to supplying reactor fuel.
“What we are targeting is to build South Africa as a nuclear cluster of nuclear industries so that we can use our partners and our partnership for our expansion into Africa,” Polikarpov said in an interview Tuesday in Cape Town.
Rosatom can offer financing options, Polikarpov said, according to Bloomberg. These include a contract with a state-export credit offered to the government of South Africa, a buyer-owner operator agreement, a public-private partnership, or a combination of them…….
The allure of the turnkey nuclear power plant, built, owned and operated by Rosatom, allows governments across the world to embrace such projects. But for Russia they are much more than a major economic export. They are another geopolitical tool, allowing the Kremlin to tie up strategic governments into long-term cooperation. http://afkinsider.com/126032/how-russia-is-expanding-its-vast-nuclear-empire-into-africa/
South Africa targets more renewable power, nuclear expansion to go ahead
*Renewable energy seen contributing 17,800 MW by 2030
* Nuclear expansion process to be affordable, above board
Africa’s most industrialised country has turned to solar and wind power to diversify its energy mix and help plug electricity shortages. The first 47 renewable energy independent power producers are due to be fully operational by July.
It also hopes to install 9,600 megawatts of nuclear power in the next 15 years to address chronic electricity shortages but the cost of the project estimated at about $100 billion has raised budgetary concerns.
Tina Joemat-Pettersson reaffirmed in parliament that the planned nuclear expansion would be “corruption free”, following concerns by opposition parties over the tender process and about the affordability of the project in a country whose economic growth has stagnated.
The department of energy would issue a request for proposal to confirm market appetite for the fleet of nuclear plants and help secure commercial and financial information for the government to make a final decision, she said.
“We will only implement what our country can afford,” Joemat-Pettersson said.
Forecasts for growth in South Africa have fallen to below 1 percent for 2016 as a global commodity slump drags on and rising inflation rates curb domestic spending.
Department of energy presses ahead with nuclear, Business Day Live, BY BEKEZELA PHAKATHI, 10 MAY 2016 THE Department of Energy said on Monday it was still confident of conducting a successful nuclear-procurement process.
SA is aiming to install 9,600MW of nuclear power within the next 15 years to tackle the electricity shortages. However, the cost of the project, estimated at about $100bn, continues to be a major budgetary headache for government.
Earlier this year, the Treasury put brakes on nuclear spend, putting more emphasis on gas and smaller coal-fired power stations to attend to the electricity crisis. It said in its budget review that the nuclear energy newbuild programme would proceed after a “thorough and transparent tender process”.
There have been reports that the Treasury’s reluctance to sanction the procurement of the new nuclear power stations was one of the major reasons behind the sacking of Nhlanhla Nene as finance minister in December.
The National Nuclear Regulator expects to finalise a decision by 2018 on Eskom’s two new site licence applications. ……http://www.bdlive.co.za/business/energy/2016/05/10/department-of-energy-presses-ahead-with-nuclear
ROSATOM TO GROW PUBLIC AWARENESS ON NUCLEAR ENERGY, Eyewitness News, The Russian atomic energy company faces strong resistance from environmental lobbyists in SA. Rahima Essop 21 Apr 16 CAPE TOWN – Rosatom says it has to ‘gradually grow public awareness and acceptance’ about nuclear energy as the Russian atomic energy company faces strong resistance from environmental lobbyists and opposition politicians in South Africa.
Two organisations have challenged the legality of government’s proposed 9,600 MW nuclear build programme in court before Energy Minister Tina Joemat-Pettersson calls for quotes for the tender.
Rosatom is said to be on the inside track for the contract.
The Democratic Alliance (DA), meanwhile, is pushing for the project to be abandoned on the basis that it’s unaffordable and shrouded in secrecy.
Rosatom has billed nuclear as a cheap source of energy and a job-creating solution for the country.
The company, which is building 34 reactors across the globe, is hoping to influence South African perceptions about nuclear…….Rosatom has sponsored a press trip to Hungary. http://ewn.co.za/2016/04/21/Rosatom-to-gradually-grow-public-awareness-on-nuclear-energy
Australian mining company denies role in murder of South African activist
Campaigners claim death of Sikhosiphi Rhadebe is an escalation of violence against opponents of a mine owned by Perth’s Mineral Commodities Limited, Guardian, Joshua Robertson, 25 Mar 16 An Australian-owned mining company has denied any link to the murder of an activist leading a campaign against its plans to mine titanium in South Africa.
Sikhosiphi “Bazooka” Rhadebe was gunned down at his home in Xolobeni on South Africa’s Wild Coast on Tuesday, in what fellow activists claimed was an escalation of violence and intimidation against local opponents of a mine owned by Perth-based Mineral Commodities Limited (MRC).
MRC, which has repeatedly denied inciting violence involving its supporters, said it was “in no way implicated in any form whatsoever in this incident”.
Mzamo Dlamini is a fellow activist who believes he is among the “prime targets” on the anti-mining Amadiba crisis committee following Rhadebe’s death.
Despite fearing for his life, Dlamini vowed to continue organising resistance to a project that campaigners said would force the relocation of an estimated 100 households and up to 1,000 people.
“The assassination affects us all,” he said. “There will be more Bazookas long after we have died.”
Six people associated with the mining venture were subject to court orders last May after a clash over land access, during which a TEM director fired a “warning shot” in the air.
Four people, including an alleged employee of another MRC mine at Tormin, are due to face court next month over alleged assault and intimidation, including with firearms, of mining opponents in Xolobeni in December. These allegations are yet to come before a court and there is no suggestion these or any other employees were involved in Rhadebe’s murder……..
Lawyer Henk Smith of the Legal Resources Centre, which has acted for landholders opposing MRC’s Tormin mine, said the killing of Rhadebe, a “principled democrat”, had likely ended the prospect of conciliation meetings between the miner and its opponents.
“I think the company has made a few statements condemning the violence but it comes after the event and the company has never taken any steps to encourage conciliation or mediation or consultation even a meeting,” Smith said.
“In fact the company shies away from meeting the community which as a result, there’ll be little chance of simply starting a process of meetings now.
“For the rest, they’ve got [to] swallow what the company offers.” http://www.theguardian.com/environment/2016/mar/25/australian-mining-company-denies-role-in-of-south-african-activist
SA planned binding nuclear deal with Russia, Business Day BY CAROL PATON, 31 MARCH 2016, NEW proof has emerged that SA intended to sign a binding deal with Russia to buy a fleet of nuclear reactors, bypassing public finance management rules along the way.
This is contained in court papers lodged on Wednesday by the Southern African Faith Communities Environmental Initiative and Earthlife Africa in the High Court in Cape Town.
The lobby groups, which are asking the court to declare the inter-governmental agreements on nuclear energy signed in 2014 unlawful, secured the new information through court processes that compelled the government to provide the record of decisions on the deal.
Among the records provided is an explanatory memorandum drafted by the state law adviser in November 2013 on the draft Russian deal, which makes clear — they say — that the deal was “intended” and was “understood as creating a firm commitment that Russia would construct the required nuclear plants in SA”.
The state law adviser’s memo has been long sought by the media and opponents of the forthcoming nuclear procurement as it was widely rumoured at the time that the office had given a strong warning that the proposed agreement was binding in nature, had budgetary implications and had to be debated publicly before it could be adopted.
Asked at the time to comment, chief state law adviser Enver Daniels refused, citing client confidentiality……..http://www.bdlive.co.za/business/energy/2016/03/31/sa-planned-binding-nuclear-deal-with-russia
The madness of the nuclear build programme http://www.rdm.co.za/politics/2016/03/29/the-madness-of-the-nuclear-build-programme
Nuclear vendors are loathe to submit to a competitive tendering process based on a long-term, fixed-priced contract ANTON EBERHARD 29 MARCH 2016 IT IS time for the gloves to come off. The onus is on those who support the procurement of nuclear power stations to demonstrate that this initiative is not corrupt and will not be ruinous for the economy.
We face a possible credit rating downgrade to junk, which will make us all poorer: it will cost a lot more to service our debt, there will be less money for social programmes, the rand will fall even further, and inflation will rise.
Yet some still promote a huge nuclear programme that is not needed, that is more expensive and risky than alternative energy sources, that is hard to finance, and that will create contingent liabilities for the Treasury when we can least afford them.
SA does not need to procure large chunks of new power now. Electricity demand is not growing: it’s falling, and is lower than it was a decade ago. Depressed economic activity is partly the reason, but it’s not the most important one.
Electricity and economic growth data no longer track each other. The size of SA’s economy has continued to increase, albeit slowly, but electricity consumption has headed in the opposite direction. Countries such as Australia have seen a similar decoupling of energy and economic growth.
Could electricity demand in SA rebound if economic growth revives? Do we need to cater for depressed electricity demand as a result of Eskom supply constraints? Possibly. But we also need to recognise that there are profound changes to the energy-intensity of our economy, as smelters and mines close. The structure of our economy is changing. A fourfold increase in electricity prices in the past decade has accelerated energy-efficiency investments and energy conservation.
Official electricity demand forecasts and plans are obsolete. If demand for electricity were to reignite, it would fire off a lower base, and the rate of growth would be lower. When we project demand forward to 2030 or beyond, it’s obvious that we need a lot less power than was forecast in the Integrated Resource Plan of 2010 (the basis for the 9600MW nuclear commitment).
But we also need to replace old coal power plants, and compensate for the decline in the performance of Eskom’s existing power stations. I’ve taken all these arguments into account, and calculate that we need about 17GW of new electricity generating capacity by 2030. Some may calculate a slightly different number, but the required capacity will be close to this.
We have already ordered more power than we need by 2030. The new Eskom Medupi and Kusile coal power stations will add 9.6GW; its Ingula pumped storage scheme, 1.3GW. Two peaking power stations — Desisa and Avon, ordered by the Department of Energy — will add 1GW.
Contracted industrial co-generation and the department’s coal independent power producers (IPPs) will each add 1GW, with plans for more. In addition, 92 projects, totalling 6,347MW, have been contracted in the first four rounds of the department’s renewable energy IPP programme. Granted, this is intermittent power and will need to be complemented by gas power plants that the department plans to procure this year. More than 3GW are in the pipeline.
In the meantime, SA has negotiated 2.5GW of hydro power from the Inga 3 development in the Democratic Republic of Congo, and is considering further hydro imports from the region.
Together, these power procurements exceed what we need in the next 15 years.
Our cheapest sources of power are now wind and solar energy. The Department of Energy has awarded long-term, fixed-price contracts for wind energy as low as 57c/kWh, far below Eskom’s average cost of supply. Renewable energy combined with gas power can offer reliable base load supply at less than R1/kWh. Imported hydro and coal IPPs will also beat this.
I challenge any nuclear power vendor to sign a long-term power contract at less than R1/kWh. Whenever I ask them what nuclear power will cost in the country, they say “it depends”, and “it will need to be negotiated”.
This is the point: nuclear vendors are loathe to submit to a competitive tendering process based on a long-term, fixed-priced contract in which they take the risks of construction time and cost overruns. But all the other energy technology providers are prepared to do so. This has been the basis of the success of the IPP programme that has delivered such spectacular investment outcomes and price certainty for consumers. So why would we opt for a nuclear procurement programme that aims only to select a strategic partner, with subsequent price negotiations that have uncertain outcomes?
Nuclear power plants are also hard to finance. A couple of years ago in Davos, President Jacob Zuma was asked how 9,600MW of nuclear power would be financed. His answer, remarkably, was: “I’ll speak to my finance minister.”
He would have had that conversation by now and it will be clear that there is no fiscal space to finance a programme that will cost more than a half-a-trillion rand, when we raise just more than a trillion rand annually in taxes to fund all SA’s needs. Debt financing is now the fastest-growing component of the national budget and interest payments are more than twice the spend on higher education.
Our traditional mechanisms for funding power investments are also constrained. Eskom’s balance sheet is stressed, and it is struggling to raise sufficient debt on private capital markets to complete Medupi and Kusile. It has no possibility of raising finance for even one nuclear power station.
The private sector will not finance a nuclear plant in SA. The only possibility is funding from nuclear vendor countries. France will struggle: its nuclear company, Areva, is technically bankrupt and its latest UK nuclear contract — at £92.50/MWh (R2/kWh) — would be unaffordable for us.
Russia will not be able to finance all of its nuclear ambitions. China is a possibility, but financing will need to be backed by a long-term contract with an agreed electricity tariff, and the government will have to provide a sovereign guarantee and insurance cover, which will add contingent liabilities to the Treasury that will hasten a credit rating downgrade.
Eskom’s management recently expressed interest in further investments in large coal and nuclear projects. Its big coal, big nuclear, and big networks strategy is Neanderthal. Why would SA want to go down this route? It’s irrational. SA’s economic situation is precarious. The government now needs to act in concert and remove uncertainty about this nuclear folly. We don’t need it, it is too expensive, and we cannot afford it.
• Eberhard is a professor at the University of Cape Town’s Graduate School of Business
- 1 NUCLEAR ISSUES
- business and costs
- climate change
- indigenous issues
- marketing of nuclear
- opposition to nuclear
- politics international
- Religion and ethics
- secrets,lies and civil liberties
- weapons and war
- 2 WORLD
- MIDDLE EAST
- NORTH AMERICA
- SOUTH AMERICA
- Christina's notes
- Christina's themes
- global warming
- RARE EARTHS
- resources – print
- Resources -audiovicual
- World Nuclear