Johannesburg - As the government prepares to request proposals for the 9 600 megawatt nuclear build programme, Eskom has applied for two nuclear installation licences to build nuclear plants, according to the National Nuclear Regulator (NNR).
The regulator said Eskom wanted to build the nuclear reactors in the Thyspunt site, situated between Oyster Bay and St Francis Bay in the Eastern Cape, and in Duynefontein, which is situated next to Eskom’s existing Koeberg nuclear plant in the Western Cape. The power utility yesterday said Thyspunt was the preferred site.
Read: Nuclear installations: Eskom eyes two sites
“Both applications mentioned the applicant’s intention to construct and operate multiple nuclear installations (power reactors),” the NNR said.
Eskom said it had submitted applications to the NNR last Thursday and it would take two years for the NNR to consider review the licence.
The NNR said the licensing process included a safety assessment and determination of compliance with regulations.
Eskom has been operating the Koeberg nuclear plant since 1984. With a capacity of 1 800MW, Koeberg contributes about 5 percent to South Africa’s total electricity output.
As it seeks to boost power supply, the government wants to add 9 600MW of nuclear power to the electricity grid. The Department of Energy last week said it planned to issue requests for proposals for the mooted nuclear programme by the end of this month.
The true cost of the nuclear power, however, remains unknown and Department of Energy director-general Thabane Zulu last week said discussion was ongoing with the National Treasury about the cost of the fleet of nuclear plants.
Indication
Zulu said responses to the request for proposals would provide an indication of a possible funding model for the nuclear programme.
Speaking at a solar conference in Johannesburg yesterday, energy analyst Andrew Kenny said debt was “by far” the most likely and sensible method for financing the nuclear power plants.
“From 1970 to 1990, Eskom built over 30 000MW of coal stations, financed on debt. The debt was cheap and Eskom paid it off in a reasonable manner. There is no reason why it cannot do so for 9 600MW of nuclear. Even today, with economic and political problems, with threats of down rating, South Africa and Eskom bond yields are still only 9.5 percent nominal. This is cheap debt for Eskom but attractive to local and foreign investors. Debt is the best way,” Kenny said.
Kenny also moved to defend the cost of the nuclear, rumoured to be astronomical.
While the government is yet to give a ballpark figure of the nuclear costs, R1 trillion has been bandied about for a few years.
“The notion that 9 600MW of nuclear will cost us R1 trillion is an urban legend with no basis in fact. I do not know where it came from,” Kenny said.
He said Eskom would own and operate all nuclear power plants in South Africa. He said the ownership of nuclear power stations could also take the form of public-private partnerships with Eskom retaining the controlling stake as the public sector player, he said.
He said proceeding with nuclear power required political will.
“There are no good technical, economic or environmental arguments against nuclear power. The only arguments against it are political and ideological. These can only be overcome by extensive public education and political will,” he said.
* With additional reporting by Reuters
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