Energy Dept rejects ‘Zuma pals score first nuke deal’ claim

The SA Department of Energy rejects the assertion that ‘Zuma pals score first nuke deal’. 

The Department issued the following statement to this effect today, 19 September

The Department of Energy has taken note of media articles that assert that Zuma pals score first nuke deal.  The Department will like to place the following information into correct context. The South African Nuclear Energy Policy of 2008 provides the framework within which South Africa will achieve its goal of being self-sufficient in all aspects of the Nuclear New Build Programme for peaceful uses of nuclear energy. The Nuclear programme shall contribute to the government’s     socio-economic development and transformation agenda.  Cabinet approved the Integrated Resource Plan 2010 – 2030 and the plan provides for the roll-out of the nuclear new build programme for 9600MW of nuclear power, will be deployed by 2030.

The National Development Plan enjoins the government to conduct thorough investigations on different aspects of the nuclear new build programme before a procurement decision is taken. More specifically, the National Development Plan directed that South Africa needs a thorough investigation on the implications of nuclear energy, including its costs, financing options, institutional arrangements, safety, environmental costs and benefits, localisation and employment opportunities, and uranium enrichment and fuel fabrication possibilities.

In line with the NDP directive the Department of Energy, in conjunction with other organs of state (within the Energy Security Cabinet Sub-Structures) has, over the past five years, been developing various strategies and policies and as a result has commissioned independent studies to create a framework for the procurement decision and the preparation for the procurement of the nuclear new build programme.  Independent transactional and / or expert advisors and other resources have been sourced by the Department over the five-year period.  Amongst others the following have been sourced and / or procured:-

  1. Ingerop: Cost of Nuclear Power,
  2. KPMG: Procurement Framework,
  3. Ingerop: Owner-Operator and Financing Structures,
  4. Deloitte: Finance Options Models Solutions,
  5. Deloitte: Deferred Return On Government Investor Approach,
  6. Ingerop: Economic Impact of Localisation of Nuclear New Build Programme,
  7. Nathan Gift Nhlapho Incorporated: Feasibility Study on Effective Independence of the National Nuclear Regulator.
  8. Nathan Gift Nhlapho Incorporated: Requirements, Considerations and Necessary Arrangements by the Government in Order for South Africa to Accede to One of the IAEA Nuclear Liability Conventions.
  9. Zimkile Consulting: The Development of Training Programme of First Responders for Nuclear and Radiological Emergencies
  10. University of Pretoria: A Detailed Financing Model for the Radioactive Waste Management Fund
  11. Mzansi Energy Solutions and Innovations Pty: Feasibility Study on the withdrawal of Safeguards Function from NECSA
  12. Mahlako-A-Phahla Investments (with sub-contracting to Ledwaba Mazwai Attorneys and WorleyParsons): Pre-Procurement Readiness Assessment.
  13. Empire Technology: Programme Management System

Cabinet designated the Department of Energy as the procuring agency for the programme. The Department of Energy has procured services and / or resources from all the above-mentioned transactional advisors and service providers to ensure that a framework which potentially addresses the needs of the Nuclear New Build Programme and requirements of the NDP.

It is important to note that the above activities are all part of the preparatory work for the procurement for the programme.  The procurement of all the transactional advisors and services providers has been conducted in a manner that is compliant and consistent with all applicable procurement prescripts.  The suggestion that there has been any bias or irregularity in the procurement of any of the services and resources is rejected.

The department also wants to reiterate that the South African Government has not entered into any deal or signed any contract for the procurement of the 9600MW of nuclear power. As part of preparation for implementation the Department of Energy is establishing a Programme Management Office (PMO), with the necessary resources including human resources; information technology and other resources.

Cabinet approved that the Department must issue the Request for Proposals (RFP) to the market and determine the final funding model as part of this process. The financial implications for the programme will be determined as the outcome of the Request for Proposals and resubmitted to Cabinet for consideration.

The Department reiterates that the procurement process for the nuclear new build programme of 9600MW nuclear power has not commenced, but will only commence upon the issuance of the Request for Proposals (RFP) for the 9600 MW nuclear power, as directed by Cabinet. Current procurement processes as outlined above are part of feasibility and assessment processes needed by government to make an informed decision in finalising our considerations for a nuclear build.

During the State of the Nation Address in February 2016, His Excellency, the President of the Republic of South Africa Mr J.G. Zuma emphasized that the country will only procure nuclear on a scale and pace that the country can afford. In his address to the National Council of Provinces (NCOP) in September 2016, The Honourable Deputy President reiterated that South Africa is not yet in talks with any foreign businesses to procure the nuclear energy new build. The Department is at an advanced stage in preparation for the issuance of the Request for Proposals.

 Government remains committed to ensure energy security for the country, through the roll-out of the nuclear new build programme as an integral part of the energy mix. Government remains committed to ensuring the provision of reliable and sustainable electricity supply, as part of the strategy to mitigate the risk of carbon emissions.

The nuclear new build programme will enable the country to create jobs, develop skills, create industries, and catapult the country into a knowledge economy. Government remains committed to a procurement process that is in line with the country’s legislation and policies. The Department of Energy rejects the assertion that “Zuma pals score first nuke deal”.

– Issued by Department of Energy