The government has put a R300-billion price tag on its proposed nuclear reactors after years of keeping mum on what the new reactors would cost.
But although this is around a third of SA’s annual budget, it is lower than the going price for a modern nuclear design.
The price, which appeared in last week’s Budget review for 2012, is lower than the current cost of nuclear reactors built in the US, which may be an indication that the government is expecting to draw cheaper bids from from Korea and China.
Questions have been raised as to whether the Korean and Chinese nuclear designs would meet European regulatory standards.
Steve Thomas, professor of energy policy and director of research at the University of Greenwich, said the R300bn translated into about $4 000 (R30 700) a kilowatt. This is called the “overnight cost” and does not include finance costs.
“The two bids they (Eskom) got last time were both over $6 000/kW, so I can only assume they are expecting Korea and China to come in way cheaper. $6 000/kw ‘overnight’ is about par for the advanced estimates for reactors in the US and bids elsewhere, so if you were going for a modern design, that would be the price,” Thomas said.
The government’s last call for tenders was restricted to the French nuclear company Areva and the American power company Westinghouse. Eskom suspended the proposed nuclear project in 2008 because of the cost. The utility was reportedly shocked by the high cost of the French and American bids.
Eskom proposes to generate 9 600MW of nuclear power by 2029. The design the government selects will determine how many nuclear power stations will be built. This could range from six to 10.
“If it was a French reactor (EPR 1 600MW), that would be six reactors. If it was an AP1000 (1 200MW), that would be eight reactors. If it was Korean APR1400 (1 400MW), that would be seven reactors. If it was a Chinese CPR1000, that would be 10 reactors. The two bids last time (in 2008) were for AP1000 and EPR designs, so it is hard to see how it could be them. The R300bn price looks like the bid made by Korea for the UAE. That was their first ever export bid and most people assume it was underpriced,” Thomas said.
Speculation
China has never bid to export nuclear reactors, so it was pure speculation to say Chinese reactors would be cheap, he said. China had sold two 300MW reactors to Pakistan, but the design and the price were not made public.
The DA’s Lance Greyling will table a motion to debate the proposed nuclear programme in Parliament as soon as possible.
The public had had no chance to scrutinise the programme. They had a right to see the evidence on which the budgetary allocation was decided, he said.
“Given that the shadow of the arms deal corruption continues to darken our democracy, the government should be extra careful about the nuclear build programme,” Greyling said.
The three sites Eskom has earmarked for the power stations are Koeberg, north of Cape Town, Bantamsklip on the southern Cape coast near Pearly Beach and Thyspunt near Cape St Francis in the Eastern Cape. - Political Bureau