South Africa to start nuclear procurement this month

South Africa will launch its nuclear power procurement process at end of this month and select a strategic partner or partners by the end of the current financial year, the country's energy ministry announced yesterday.

In a statement, the ministry said that some of the key government objectives for its nuclear new build program include: attainment of global leadership and self-sufficiency in the nuclear energy sector in the long term; a contribution to the national program of social and economic transformation, growth and development; improvement of the quality of human life and to support the advancement of science and technology.

In March 2011, the Cabinet approved and promulgated a 20-year Integrated Resource Plan, the government's electricity plan, which the ministry said is "a mixed energy agenda" that puts nuclear power at 23% (9600 MWe) of South Africa's energy sources by 2030. In accordance with this plan, the first reactor will be commissioned by 2023.

"The National Development Plan, approved in 2012, enjoins us to conduct thorough investigations into various aspects of the Nuclear New Build Program before a procurement decision is taken. In line with this policy the government undertook detailed studies on various aspects of the nuclear fuel cycle value chain, including amongst others, costs, financing, funding models, skills development, and the economic impact of localisation,” the ministry said. "These studies have confirmed the program is fundable and will contribute positively to the economy of the country."

In early 2013, South Africa hosted an Integrated Nuclear Infrastructure Review (INIR) mission by the International Atomic Energy Agency (IAEA). This was an assessment of the country's infrastructure as it relates to readiness to start purchasing, constructing and operating nuclear power plants. The ministry noted that an INIR Review Mission is not an audit, but a peer review by independent experts from the IAEA. The agency produced a final mission report on 30 May that year.

To date, South Africa has signed intergovernmental agreements (IGAs) with several of vendor countries that have expressed interest in its nuclear new build program - China, France, Russia, South Korea and the USA. Negotiations are underway to conclude IGAs with Canada and Japan, the ministry said.

"Each one of these IGAs lays the foundation for cooperation, trade and exchange of nuclear technology as well as procurement. Each vendor country focused on its own capabilities, taking into account the requirements of South Africa to achieve self-sufficient policy objectives," the ministry said. "The IGAs also describe broad areas of nuclear cooperation and they differ on emphasis based on the unique needs and capacity of each country."

They were presented to the Cabinet for discussion and approval and recently have been tabled in Parliament. They are now ready for further debate and parliamentary endorsement.

Nuclear experts from government departments, state-owned entities and universities participated in vendor parade workshops organised by the ministry. These workshops provided a platform for South African professionals to exchange views with their peers on the nuclear new build program. They covered nuclear power plant technology and construction; multipurpose research reactor technology and construction; financing and commercial matters; manufacturing, industrialisation and localisation; human resources and skills development; public awareness and information centres; safety, liability and licensing; the nuclear fuel cycle; nuclear siting and permitting; and nuclear non-proliferation matters. This process was completed in March.

Further work done in preparation for the nuclear new build program includes skills development and training as well as funding and financing models.

National skills development activities have started: 50 individuals were sent to China for nuclear training in April and plans are underway to send an additional 250 trainees before the end of this year. A Memorandum of Agreement on skills development was entered into between South Africa's Nuclear Energy Corporation (Necsa) and the State Nuclear Power Technology Corporation of China.

Russia has offered ten new scholarships for Master's Degree programs in Nuclear Technology. A Memorandum of Understanding has been signed covering the training and development of 200 South African candidates at Russian universities and educational organizations.

South Korea has an existing program to train South African students for a Master's Degree in nuclear engineering and so far three students have graduated.

France has put in place 14 bursaries for young people coming from previously disadvantaged groups. Through this four-year engineering program at various universities, these young professionals will acquire the skills and expertise to support South Africa's nuclear new build program, the ministry said. In addition, South African nuclear engineers will have work experience in France, equivalent to a total of 400 months.

Necsa has also signed a Memorandum of Understanding with EDF on skills development and negotiations with the French government on this topic are at an advanced stage that could result in the establishment of a nuclear campus in South Africa, the ministry said.

On funding, the government has completed various technical studies in response to National Development Plan directives. These include in-depth studies into the costs of nuclear power as well as funding and financing models and the economic impact of localisation. "It is important to note that the government has still to negotiate the price tag in the procurement process which is why exact figures for the study cannot be made available to the public at this stage," the ministry said. These studies were done to ensure that South Africa is a "knowledgeable customer", it said, but "the current world experience for quoted numbers for real export would indicate an overnight cost of around $5 billion per 1200 MWe, which is equivalent to $4200 per kilowatt per reactor in newcomer states". Examples include, it said, Belarus, Pakistan, Turkey and the United Arab Emirates.

In countries with established national construction programs, such as China, India and South Korea, costs of around $2500 per kilowatt are being quoted, the ministry said. "Amongst the 70-plus reactors in the world, there are a number of projects where, because of the local market and political conditions, the project costs are higher than these figures," it added.

"The government remains committed to ensuring energy security for the country, through the rollout of the nuclear new build program as an integral part of the [country's] energy mix," the ministry said. It also remains committed to "ensuring the provision of reliable and sustainable electricity supply, as part of mitigating the risk of carbon emissions".

The program will enable the country to create jobs, develop skills, create industries, and "catapult the country into a knowledge economy", it said.

Researched and written
by World Nuclear News