Supplementary Budget 2020

Gordhan confirms Eskom is new lead in nuclear plan

Cape Town – Finance Minister Pravin Gordhan said “it has been confirmed that Eskom will take the lead in the nuclear power initiative” in his mini budget speech in Parliament on Wednesday.

“The Treasury will work with Minister (Lynne) Brown’s department (of Public Enterprises) and Eskom to ensure that the scale and phasing of the programme are in South Africa’s best interests and that the procurement arrangements are transparent and compliant with the law,” said Gordhan.

“Our approach to energy security and to meeting climate change commitments also includes a substantial renewable energy programme,” he said.

“Contrary to the views of some, these are sound and sensible long-term investments. A total of 64 projects are already in progress, bringing investment, jobs, clean energy and community development.”

Matshela Koko, Eskom’s head of generation, stated last week that the “exorbitant” Renewable Energy IPP Programme (REIPPP) tariffs from bid windows 1 to 3.5 “continue to be unaffordable and require a revised funding model that does not prejudice the consumer”.

It would appear that Treasury and Eskom are headed for a collision on the topic.

Finance Deputy Minister Mcebisi Jonas reminded media earlier that the integrated resource plan is the responsibility of government and not state owned entities.

“Treasury has agreed to have a conversation with (Public Enterprise) Minister (Lynne) Brown and (Energy) Minister (Tina) Joemat-Petterrson to have a conversation about the issues raised to ensure we have cohesion.”

Gordhan said that Joemat-Pettersson and the National Energy Regulator approved another 37 independent power projects.

“Once Eskom has signed the off-take agreements, a further R58bn in investment and some 4 800 construction jobs will commence, bringing 2 354 MW of capacity to the electricity grid.”

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