Mixed reaction to SA’s plan to procure an additional 2 500MW in nuclear energy

The Minister in the Presidency responsible for Electricity, Dr Kgosientsho Ramokgopa, briefing the media on the ministerial determination for the procurement of 2500 MW of new generation capacity from nuclear. Photo: GCIS

The Minister in the Presidency responsible for Electricity, Dr Kgosientsho Ramokgopa, briefing the media on the ministerial determination for the procurement of 2500 MW of new generation capacity from nuclear. Photo: GCIS

Published Dec 13, 2023


The government's decision to procure an additional 2 500MW of nuclear energy in the next 10 years has been met with mixed reactions by electricity industry experts as the Department of Mineral Resources and Energy (DMRE) is yet to release the updated Integrated Resource Plan 2023 (IRP 2023).

This comes after Electricity Minister Kgosientsho Ramokgopa yesterday announced a Section 34 ministerial determination for the procurement of 2 500MW of new generation capacity from nuclear, following the approval of the National Energy Regulator of SA (Nersa).

Ramokgopa said the DMRE had to satisfy a number of rigorous suspensive conditions required by Nersa, which take into account various factors before the go-ahead could be issued.

After meeting all the suspensive conditions, the ministerial determination and Nersa’s concurrence are now expected to be gazetted soon, and the DMRE is looking to release Requests for Proposals for nuclear by March 2024.

“We are triggering now essentially a procurement process. We are going out to ensure that we are able to get that additional 2 500MW of nuclear capacity to ensure that we are able to meet issues of national security and energy sovereignty,” Ramokgopa said.

According to the Integrated Resource Plan 2019 (IRP 2019), the government's energy blueprint, nuclear energy forms part of the future envisaged energy mix for South Africa, alongside gas, coal, and renewables such as solar and wind energy.

South Africa currently has one nuclear power station, Koeberg, which has two units each producing 980MW, or just about 6% of the country's electricity supply.

However, an updated IRP 2023 is due to be released for public comments any time from now after numerous delays from the government.

In this regard, Ramokgopa alluded to the IRP 2019’s call for the commencement of “preparations for a nuclear build programme at a pace and scale that the country can afford”.

He said this was in anticipation of the need to supplement future energy demand when power stations reached their end of life. Ramokgopa said that nuclear energy would cost R0.60 per kilowatt-hour compared to around R1.25 per kWh for concentrated solar power, R0.87 for wind and R5 for open-cycle gas turbines.

“What we know about nuclear is that it's cheapest, safest and most reliable, and we are going this route,” he said.

According to DMRE's deputy director-general for nuclear, Zizamele Mbambo, the first unit of the new 2 500MW nuclear project was expected to be commissioned by 2032 or 2033.

However, the Koeberg Alert Alliance (KAA) dismissed Ramokgopa’s statement that nuclear as “nonsense”, saying that this was only true if you ignore the construction and financing costs, which was a significant component of the costs and was simply ridiculous to ignore.

KAA said this was all in line with the DMRE’s ongoing attempts to misinform the public by providing over optimistic ‘estimates’ of cost and lead times for nuclear power.

“New nuclear power would take so long to build, and so much can go wrong. One only has to consider Eskom’s attempts to refurbish Koeberg, which they said would take five months per unit, and now is set to take at least 18 months per unit,” KAA said in a statement.

“The timing of the announcement is puzzling. The latest revision of the IRP is about to be released for public comment. That might contain no new nuclear power, or if it does, it might be removed after input during the public consultation process. So why make this announcement now?“

South Africa's previous attempts to procure 9 600MW of nuclear energy build from Russia's Rosatom during former president Jacob Zuma's administration was mired in controversy and later dismissed in court due to the fact that the government was willing to give Russia a number of unreasonable tax breaks.

Independent energy expert Lungile Mashele said it was impossible at this stage to tell how the contracting regime of the government would procure this energy build since the process had not started.

However, Mashele said she suspected it would be a turnkey EPC contract (Engineering, Procurement, Construction + Finance) given to one of the top 3 global players - EDF, Westinghouse or Rosatom.

She said this was similar to the Egyptian nuclear build programme currently underway in El Dabaa, a 4 800MW nuclear plant with an estimated cost of $30 billion (R565bn), with $5bn of the project funded by the Egyptian government through private investors, and $25bn would be funded by the Russian government at an interest rate of 3%.

Mashele, however, doubted that the government would be able to meet the 2032 or 2033 timeline to commission this 2 500MW nuclear energy.

“The first unit of the planned 9 600MW would have been online this year had it not been the conflation of personality and energy security. Nuclear has a typical 10-year period from the start of construction to the first unit coming online. Nuclear is also famous for time and cost overruns,“ Mashele said.

“The beauty of nuclear is that it is modular so you can start with 2.5GW initially and over time scale up. Key to this procurement will be transparency, contracting regime (turnkey) and the cost.”