South Africa swaps nuclear for gas and renewables

30 August 2018 Week 34 Issue 623

The South African government has postponed controversial plans for nuclear expansion as atomic energy has proved to be both expensive and politically controversial, while power demand has stalled and is now falling. 

The government now aims to defer any decision on building new nuclear reactors until 2030, and will focus instead on reducing coal consumption and boosting renewables.

South African Energy Minister Jeff Radebe released the government’s long-awaited Integrated Resource Plan (IRP) this week,

“There will be a study to determine if more nuclear is needed after 2030,” Radebe said on August 27. “But until then, there is no increase in nuclear generation envisaged.”

The IRP comes eight years after the previous update, and gives priority to natural gas and wind. The plan details that 8,100 MW of both wind and gas-fired capacity should be built in future, together with 5,670 MW of solar and 2,500 MW of hydro. A mere 1,000 MW of coal-fired capacity will be added to the grid.

Electricity demand on the grid has been declining on an annual basis, Radebe said.

“For the financial year to March 2018, the actual total electricity consumed is about 30% less than what was projected in IRP 2010,” he explained.

Falling demand should allow the country to close elderly coal-fired thermal power plants, replacing them with cleaner gas, solar and wind projects.

The IRP confirms Eskom’s central role in the power industry, despite the emergence in recent years of independent power producers (IPPs), which will continue to dominate the renewables sector.

Eskom last week reported a US$160 million loss for the year to March 2018, with its state-guaranteed debt mounting to US$15 billion. The company admitted in its annual report that it had found US$1.4 billion of irregular spending since 2012.

South African President Cyril Ramaphosa has this year overseen the replacement of Eskom’s leadership as he seeks to attract US$100 billion of investment to the country.

The changes follow the departure of South African President Jacob Zuma in February. He had championed the developing of nuclear power in the country, and had supported plans to build up to 9,600 MW of new capacity at eight reactors.

The arrival of the new president considerably weakened the nuclear lobby in South Africa, and the current IRP has put atomic energy’s prospects on the back-burner.

Looking ahead, the IRP predicts that by 2030 the country’s capacity will stand at 74,400 MW, with coal providing 34,000 MW (46%).

Next will be gas with 11,930 MW (16%), wind with 11,442 MW (15%), solar with 8,558 MW (11%), hydro with 7,608 (10%) and nuclear with 1,860 MW (2.5%).

NewsBase Intelligence (NBI) views that nuclear power had proved to be too politically controversial and was closely identified with the government of Jacob Zuma. As such, the new government and management team at Eskom are keen to make a fresh start and distance itself from the atomic lobby.

However, as well as promoting gas and clean generating technology, the government will have to spend on grid infrastructure, both in remote areas and urban centres, if the country’s power system is to keep pace with demand and provide reliable supplies to industry and consumers. 

Edited by

Richard Lockhart

Editor

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