Addressing journalists before his speech, Gigaba, just like President Cyril Ramaphosa, said the procurement of new nuclear power was not a priority at the moment as the country could not afford it and had electricity overcapacity.
He said the government’s stance on nuclear remained unchanged.
“We cannot afford it. (But) it remains in the energy mix,” he said. The cabinet approved the revised integrated resource plan (IRP) in December last year. “We did not say we will start (procuring nuclear) immediately,” said Gigaba.
New capacity from nuclear is one of the options envisaged in the IRP, which directs the expansion of the electricity supply over a given period.
In his maiden budget speech, Gigaba made no reference to the controversial nuclear procurement programme.
Last month Ramaphosa told international media at the World Economic Forum (WEF) conference that nuclear was not an immediate priority. He also cited its cost and the electricity overcapacity. “We have to look at where the economy is - we have excess power and we have no money to go for a major nuclear plant building. We have said the nuclear process will be looked at in the broad context of affordability,” Ramaphosa said in Davos last month.
According to Energy Minister David Mahlobo, there was a downward revision of allocations for the different technologies including nuclear. At the time, Mahlobo said lower demand for electricity had prompted the downward revision of allocations. In the original IRP plan, which was promulgated in 2011, nuclear was allocated 9600MW of new nuclear capacity by 2030.
Gigaba said Eskom already had three main new build projects - the Medupi power station, the Kusile power station and the Ingula hydro power station. He said there was also electricity from renewable energy projects in the renewable energy independent power producer programme.
The Department of Energy recently instructed Eskom to sign power purchase agreements with 27 independent power producers.
Until the Department’s directive, Eskom had been resisting pressure to sign the agreements, citing the cost of renewable energy.
- BUSINESS REPORT