Business Maverick


Mantashe sends clear signal SA will tender for nuclear power proposals as soon as possible

Mantashe sends clear signal SA will tender for nuclear power proposals as soon as possible
Mineral Resources and Energy Minister Gwede Mantashe. (Photo: Leila Dougan)

Mineral Resources and Energy Minister Gwede Mantashe has revealed that South Africa still plans to tender for proposals to build new nuclear capacity. The exact timing of the tendering and amount of megawatts are not set in stone, but ‘the sooner the better’ is the goal.

Energy Minister Gwede Mantashe made the remarks at the department’s offices in Pretoria during a roundtable discussion with Daily Maverick

“We are going to send out the proposals,” the minister said, speaking specifically to the issue of nuclear power. Asked about the timing, Mantashe said: “The sooner the better … we are going to do it.”

Mantashe, who is regarded as a close ally of President Cyril Ramaphosa, has often spoken approvingly of nuclear energy. Last year, meetings were held in St Francis Bay and Jeffreys Bay by the National Nuclear Regulator to discuss the possibility of a new site at Thyspunt on the Eastern Cape coast.

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But this is the first clear signal in some time that the DMRE is actively planning to open up the process for bidding. Such a move would come against the backdrop of Eskom’s ongoing woes, concerns about the cost of such projects, safety jitters at South Africa’s only nuclear power plant, Koeberg, and moves by the European Union to label nuclear energy as green.

Nuclear is declared green, but specialist skills are vanishing and costs are spiralling

“When you send a request for proposals, you are doing two things. You are testing the applicants of the market, and then you decide on the modalities. There can be someone who will say, we will build it, we will use it, and then give it back to you. That is covering our costs. That is an option,” Mantashe said. 

That would imply a clear element of privatisation in the process, which would hopefully take the South African taxpayer off the hook – not to mention the Treasury, which is trying to contain its debt burden and make the process affordable. 

That is a legitimate concern considering the cost overruns that have plagued nuclear power plant projects elsewhere, most recently in Finland, where the Olkiluoto-3 plant – Europe’s first in almost 15 years – saw costs surge from initial estimates of  of €3-billion to €11-billion, according to the 2019 World Nuclear Industry Report.

And after the debacles of the Medupi and Kusile coal-fired power plants – with their cost overruns, missed deadlines and shoddy performance – there is a reason why load shedding returned this week. South Africa should be aware of the ultimate price to be paid from any megaproject.  

“It’s not only us who are looking into that option,” Mantashe said, referring to Ghana, Nigeria and the UK. 

He also said South Africa was not planning on building the 9,600MW envisioned under former president Jacob Zuma, but an unspecified amount that would depend on the bidders. 

The Zuma plan was, of course, linked to Russia’s Rosatom, with an estimated R1-trillion price tag that was widely seen as enriching more than just uranium. A certain “fire pool” was seen getting an upgrade as a result of such a deal. 

Civil society would likely regard any nuclear deal with Russia – if it emerged as the preferred bidder or supplier from any process – as radioactive, given the obscene crony capitalism that has come to define Vladimir Putin’s autocratic regime, which now stands accused of committing war crimes in Ukraine. Also, the stench of Zuma’s bungled nuclear deal would hang in the air. 

Nuclear power can deliver cheap energy once everything is up and running, and it is being given a green sheen – which is not without controversy – as the planet grapples with climate change. But the devil will be in the details.  

The bottom line is that the DMRE has its finger on the nuclear button, and any deal on that front will be subjected to intense scrutiny and debate. DM/BM

Absa OBP

Comments - Please in order to comment.

  • Patrick Devine says:

    SA courts cannot allow an openly and admittedly corrupt Gwede Mantashe to lead a Nuclear build process.

    It’s illogical and criminal.

    • Graeme J says:

      I am personally very in favour of nuclear as a long term energy source, but not with the ANC snouts and trotters firmly in the trough. Energy production should be deregulated to allow private energy companies to produce any amount of energy they wish (not the current restricted amounts that Gwede tried to restrict).

  • Craig B says:

    Please with what money?

    • Lorinda Winter says:

      I agree, with what money? It’s all been looted by our government. Oh I forgot! How stupid of me. The taxpayer! That lovely goose that keeps on laying the gokden eggs!

  • Brian Cotter says:

    The Zondo Commission has recommended that a Public Procurement Anti-Corruption Agency be established through legislation to curb procurement irregularities. Can this be in place before RFP’s have been issued so they can audit every stage of the process. Also no ANC middlemen bringing in the back door BEE slant. This is not a Russian sole source enquiry but a full international enquiry that will be a test of ANC handling the RFP openly and honestly as a start and for the next elected Government to finish. Karpowership is our shining example of our last attempt at International Power Plant procurement after dismal failures at Medupi and Kusile for ANC Hitachi design and build . So can we book the Courts now for timeshare as Zondo prosecutions should be in full force by then.

  • Johan Buys says:

    we should ask for nuclear IPP to propose supplying in terms of PPA.

    But don’t hold your breath. For some weird reason none of the pro nuclear crowd includes anybody with the stomach to sign a PPA

  • Peter Atkins says:

    Here we go again …
    Nuclear power stations in their current form are more expensive than wind and solar, generate long lasting waste, cannot ramp up and down quickly to follow the load peaks, have long lead times (Olkiluoto 3 construction started in 2005 and is only due to go online in 2022 – so 15 years excluding the regulatory hurdles that had to be overcome before 2005), and huge budget overruns (recently doubling in price). South Africa has shown that we are not capable of handling mega-projects, just look at Medupi and Kusile. Finally, the modelling done by the CSIR, Eskom, and Meridian all show that nuclear power is more expensive than alternate forms of generation. The DMRE had to force nuclear generators into the IRP 2019.
    We need to stop the DMRE before they waste more money.

    • Peter Dexter says:

      But renewables don’t generate the “commissions” that nuclear does. It has more to do with production of kickbacks than clean, cheap power.

  • David Le Page says:

    Ed, please substantiate your contention that “Nuclear power can deliver cheap energy”? This is just not accurate. The latest figures from Lazard’s comparing the levelised cost of different energy technologies clearly show nuclear to be amongst the most expensive options – and that’s *without* figuring in decommissioning costs, which are massive for nuclear.

    • Dave Martin says:

      The new Chinese reactors are surprisingly cheap. US$0.08 per kWh for 24/7 energy. That’s pretty good. Renewable plus 8 hours battery will be a lot more than that.

  • Why is nuclear on the table when the evidence appears to support solar and wind? Who is advising the Department and with what interests? Surely we can demand answers to these basic questions.

    • Dave Martin says:

      The problem is windless nights. Wind and solar is cheaper if you are happy for rolling blackouts when there is no sun/wind. The correct comparison would be wind/solar PLUS batteries. The big unknown is how big these batteries need to be. Do we need enough for 1 hour of no wind/sun or 8 hours? The difference between 1 hour and 8 hours of battery is an exponential increase in cost.

      • William Kelly says:

        Nope. That’s assuming all generation is wind and solar only which is not the case. Excess ‘storage ala battery’ power can be achieved with hydro electric, quite efficiently. Gas turbines for backup, plus private power generation (whose electricity it is anyway?) takes away the Eksdom money trough from the thieving politicians. That’s why it’s such a big problem for them – no control means no money – and why do you think they want to control EVERYTHING?

  • jcdville stormers says:

    Bla,bla,bla, Goverment putting the back pocket 1st like usual!!!”We are there for the people”,Gwede you make me go ha,ha ha,ha,ha

  • Jon Quirk says:

    It seems that the ANC rotten core are looking for one last massive payday. I do hope that at the very least there are some independent, competent people, rather than politicians that get to make this call.

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