The proposed nuclear program could run up costs exceeding R1 trillion rand and this has been the big question regarding the proposed deal as the source of the funding is still an uncertainty. This seems to be clearer as Eskom feels they have the capabilities to fund this project without additional state assistance.
Eskom states that they will be able to self-fund the proposed nuclear deal.
Eskom has stated that they will be capable of funding the proposed nuclear deal due to improved availability of funding. According to Matshela Koko, Head of Generation, Eskom has managed to improve their finances through better revenue as a result of more efficiently run plants, the completion of the recent build program and better access to funds. He projects that Eskom will have around R150bn available after 10 years. This coupled with an increase of R90bn to Eskoms borrowing programme highlighted by the 2016 – 2017 corporate plan allows an additional R327bn to be available.
This will still fall significantly short of the estimated R1 trillion required to fund the nuclear programme, however Koko advises that we should be looking to replicate nuclear plants with proven track records as opposed a top-of-the-range plants being built today. Modern nuclear plants are built to 3rd generation standards, which were developed after the Fukushima disaster in 2011, however Koko has expressed that a Generation 2 nuclear plant would be more than sufficient and considerably more affordable. A plant similar to the Generation 2 plants currently under construction in Saudi Arabia and Turkey by Rosatom should be ideal, however other countries such as France, India, Russia, Japan, China, Canada and South Korea should be considered.
“What I’m saying is don’t go for the cutting edge. It’s going to cost you an arm and a leg. Go for a reference standard plant that is licensed already by a regulator elsewhere, from a vendor with a domestic nuclear programme that is thriving and that has a history of successfully exporting its model,” Koko said.
South African Nuclear Deal raises safety concerns
The proposal to pursue a Generation 2 instead of Generation 3 nuclear power plant has raised some concerns over the safety of these plants going forward. In addition the change in proposed technology will most likely result in the entire evaluation process starting from the beginning again and creating even further delays to the process despite Energy Minister Tina Joemat-Pettersson ‘s announcement that the request for proposals would be issued at the end of this month.
This has also sparked outrage amongst the DA and other nuclear watchdogs who wish to see legal proceedings completed before the procurement process can begin. This is a result of the allegations of a secret nuclear deal with Russia already being underway.
What will South Africa do with the nuclear waste generated?
More interesting reading focusing on the issues surrounding what will happen with the nuclear waste if we pursue these nuclear plants can be found here: http://www.bdlive.co.za/opinion/2016/09/20/where-will-sa-put-lethal-nuclear-waste