Costs to escalate to R20bn
16/06/2008 16:11  - (SA)  

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Johannesburg - Public Enterprises Minster Alec Erwin must justify why he has committed billions of taxpayers' money to an extremely experimental technology, the Democratic Alliance said on Monday.

"During a recent meeting of the Portfolio Committee on Public Enterprises in Parliament, the DA raised concerns about the cost of government's proposed Pebble Bed Modular Reactor (PBMR) - which has been subject to protracted delays and mounting costs," said DA spokesperson on Public Enterprises Manie Van Dyk.

"SA taxpayers are bearing the cost of this experimental technology. According to recent estimates, the PBMR will cost R20bn, R8bn of which has already been paid."

The unit is designed to produce 165 megawatts of electricity.

Van Dyk said this should be compared to a coal power station, which costs about R80bn to construct but delivers 4 000 megawatts of electricity.

The PBMR 2007 Annual Report acknowledged the support of Erwin - whose department became custodian of the PBMR during the 2007 financial year, Van Dyk added.

"As stated in the report: 'Honourable Minister Alec Erwin' reiterated government's intention to eventually produce between 4 000 MW and 5 000 MW of power from the pebble bed reactors in SA.'"

It is estimated that to build additional units will take approximately two years per unit and cost US 4&nbksp;000 per kilo-watt.

At the current exchange rate this amounts to R32 000 per Kilo-watt or R32m per megawatt. Using these estimates, the cost of producing 4 000 megawatts using this electricity will amount to R128bn."

Van Dyk said in 1998, the public was told that the PBMR demonstration plant would be completed in five years at a cost of R2bn.

"Currently, it is estimated that the plant will be complete by 2015 at a cost of R20bn."

Van Dyk said that in a recent interview, Professor Steve Thomas, of the University of Greenwich's Public Services International Research Unit, referred to the PBMR as a "radical new design that hasn't been built successfully anywhere before."

- Sapa

- SAPA

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