The South African government would be ready to make an announcement about the shape of the country’s multibillion-rand nuclear energy programme before the end of this year, Energy Minister Dipuo Peters said yesterday.
The minister told Business Report during an exclusive interview in Moscow that the government would have made a decision on the nuclear energy technology it would choose, suppliers it would contract as well as the procurement process it would favour, by the end of the year.
The government was considering government-to-government partnerships, an open bid process, as well as a selective listing of expert tried-and-tested global energy giants.
The process it would select would also influence the financing model and the stake it would hold in the programme.
Peters said the government had budgeted about R300 billion for the project, which would add 9.6 gigawatts of electricity generation capacity to underpin growth in the local economy.
This was about 25 percent of South Africa’s current installed capacity, but would constitute a smaller portion of the country’s energy mix when the nuclear energy programme was completed in 20 years.
This was because electricity demand and supply was expected to double in the next 20 years.
Peters said the government also needed to finalise details such as the local content rules and the broader impact on local suppliers and related industries. The country had already passed a stress test related to safety concerns in March this year.
According to Alexey Kalinin, the head of international business at Russian state nuclear corporation Rosatom, a $40bn (R341bn) nuclear programme, the size of South Africa’s project, could create up to 16 000 jobs.
Kalinin said the state-owned company was working with the South African government and a memorandum of understanding had been signed with the South African Nuclear Energy Corporation (Necsa) to share expertise in areas such as production and marketing of nuclear by-products, including isotopes, nuclear fuel fabrication and the manufacture of power station materials.
Kalinin said the company had global experience with projects in the Czech Republic and Turkey, and these showed that during the construction of the first two units in countries such as South Africa, local industries could be responsible for between 30 percent and 40 percent of the content.
When the final two units of the eight units were finalised, local suppliers could be providing up to 70 percent of the project’s needs. This was more than $16bn in contracts for local suppliers.
Ayanda Myoli, the chief executive of the Nuclear Industry Association of SA, said the body – whose members include Eskom, Murray & Roberts, Aveng and a few universities – had been working with the government to determine the readiness of local suppliers and the availability of the required engineering skills.
The project would need thousands of engineers and Myoli said there was general consensus among major industry players that South Africa had the capacity to produce these engineers.
Both Peters and Kalinin emphasised that the skills and experience obtained in the failed pebble-bed nuclear reactor project would be relevant and useful in the new programme.
Mzwandile Faniso travelled to Moscow as a guest of Rosatom.