Atomic ambitions race the clock
A standoff is brewing in the government over whether South Africa can pull off its new nuclear ambitions within the time frames and scale envisaged in government policy.
Private sector analysts are sceptical about whether nuclear power can be brought on stream by the 2023 deadline, given that key decisions on power generation outlined in the Integrated Resource Plan (IRP2010) have not been made.
The department of energy said the government was on track to meet the time frames set out in its 20-year electricity road map and there was no shift in state support for new nuclear development.
Plan B for nuclear energy
But in a presentation on the national development plan in Parliament last month, the National Planning Commission said it had reached agreement with the energy department that a plan B was needed if nuclear energy could not be brought on line in time.
“We have raised issues around the costs of nuclear and our ability to finance it, as well as the institutional arrangements to run an effective, large-scale nuclear programme,” national planning commissioner Anton Eberhard told MPs.
“We are slightly concerned about the timelines ... and we have reached some agreement with the department of energy that there needs to be a plan B if that first option cannot materialise. That plan B would almost certainly be a more diverse range of options, including gas.”
Eberhard said this would not necessarily come from controversial proposals for hydraulic fracturing — “fracking” — in the Karoo because it would take about 10 to 15 years to develop a mature industry. Other gas resources could come from a range of potential sources such as offshore gas, methane gas embedded in coal seams and imported liquefied natural gas.
In engagements with the commission, energy department spokesperson Thandiwe Maimane said the scenario in which nuclear was replaced with gas was not modelled in the IRP2010.
“The energy department agreed to model a scenario where nuclear was 100% replaced by gas. This does not deal with where such gas would come from, or the timing and infrastructure development for gas,” she said.
“If this is interpreted as plan B by the commission, well, then.”
It is unclear whether this scenario would ever be included in a reviewed version of the IRP2010.
The commission’s Kuben Naidoo said the plan was still the country’s policy, because it had been adopted by the Cabinet and implemented through extensive collaborative effort.
But, he said, although the power from nuclear generation was low on carbon, it was likely to be expensive at a time when the country was “capital-constrained”. A detailed cost-benefit study was needed before South Africa committed itself to major nuclear expansion.
Gas, given that it would be more localised, could present a lower risk to South Africa’s balance of payments and was likely to play a larger role internationally in coming years.
The price of a nuclear programme, which would result in six new nuclear power stations by 2030, is not clear.
In extensive reports on the subject, the Mail & Guardian and private sector experts have calculated that building nuclear stations would optimistically cost R377.98-billion but, in the event that there are delays in construction or cost overruns, it could amount to more than R1.4-trillion.
But Ken Robinson, executive director for resources at AccentureSA, pointed out that the window to key decisions on power allocations was already closing.
The IRP2010, gazetted in May last year, included a table of firm commitments needed immediately to ensure that power projects came online at the required capacity and in the time frames scheduled.
This included firm commitments to 1 000MW of coal power from independent producers by 2014 and 2015, the first 3 200MW of nuclear power for 2023 and 2024, 2 609MW of import hydropower to come online between 2022 and 2024, and 711MW of power from closed-cycle gas turbines between 2019 and 2021.
There has been significant progress in allocations for renewable energy since the government led renewable power procurement process. But, said Robinson, the decisions on the sources of base-load power — nuclear, gas and coal — had not been taken.
“They are already a year late and some of these things cannot be sped up,” he said. “There is no firm commitment on anything except a little solar and wind.”
A nuclear energy co-ordinating council was established under Deputy President Kgalema Motlanthe to oversee the nuclear development programme. Announced last year, the council has yet to meet.
The IRP2010 has estimated that the lead time for a nuclear power station would be 16 years.
Robinson said this could mean a third coal power station would need to be brought forward to ensure supply was met.
The notion that South Africa might see another coal-fired power station before a nuclear one was echoed by a senior government official, who said more coal-fired power stations might need to be considered sooner than planned.
The IRP2010 is an iterative process and scheduled for review this year. Many of the assumptions could be reworked to incorporate developments that took place since the plan was drawn up.
But Maimane said the department was confident that the commitments necessary in the short term for implementation of the IRP2010 were not falling behind. Most of the necessary decisions had been taken. She did not, however, elaborate on what these were.
In terms of the scenario that coal power would need to be brought forward, she said, there was a need to align this idea with the assumptions about demand that went into the IRP2010.
Weak demand growth
At present, Maimane said, there was evidence that the demand growth was not strong enough to warrant bringing coal forward.
“On the contrary, we believe that we can postpone some of the capital investments on the supply side through aggressive energy efficiency and demand interventions, coupled with the necessary incentive and penalty regime.”
A more careful consideration of major capital investments might well be warranted. A second government official, who also asked to remain anonymous, believed that a conservative estimate for the cost of the nuclear programme would be closer to R500-billion, if properly executed. It was “inconceivable” that the country could absorb the cost of nuclear procurement in the region of R1-trillion, said the official.
Maimane denied that there was any shift in attitude in government circles towards the nuclear programme.
The cost of nuclear development is not the only consideration for South Africa.
The International Atomic Energy Agency has recommended a guideline of milestones that countries should reach in the development of nuclear infrastructure. It covers 19 areas, including funding and financing, nuclear safety, the regulatory and legislative framework, human resources development and management.
According to the energy department, an assessment has been done to measure South Africa’s readiness and identify possible gaps.
“Preparedness in relation to embarking on such a programme has already been assessed with indications of the gaps that need to be closed,” said Maimane.
The atomic energy agency would then do an independent assessment to be completed by October.
Maimane did not comment on whether these assessments would be made public.