Govt spends millions on nuclear advice – minister

Energy Minister Tina Joemat-Pettersson at the SA International Renewable Energy Conference in Cape Town. (Photo: GCIS)
Energy Minister Tina Joemat-Pettersson at the SA International Renewable Energy Conference in Cape Town. (Photo: GCIS)

Cape Town – The department of energy has spent close to R33m of its earmarked R200m on advisory services for South Africa’s nuclear build programme, said Energy Minister Tina Joemat-Pettersson. 

Responding to a written question from Phakamani Dlamini, EFF MP, about how much has been spent on advisory services thus far and what the names of the service providers are, Joemat-Pettersson said advisory services to the extent of R20m were obtained from Mahlako-A-Phahla and project management systems from Empire Technology to the value of R171m were procured. 

READ: Energy Dept urged to elaborate on nuclear bid list

Mahlako-A-Hahla Investments and Empire Technology have each respectively been paid R10.1m and R22.8m. Empire Technology belongs to Shantan Reddy, the son of a close friend of President Jacob Zuma, Vivian Reddy. 

Joemat-Pettersson said the procurement of the advisory services is earmarked for the entire 2016-2017 financial year. Government expects to be advised on services such as programme and contract management.

“This is an ongoing activity for this financial year.”

The minister said the department of energy intends to tap an array of service providers on issues covering programme management resources, information technology and security, financial management, legal compliance, technical advisory, commercial and supply chain management. 

Earlier, the department of energy did not want to comment on the nature of the services Empire Technology would provide to the department, except to say it was for a “system” that will manage the nuclear project. 

READ: New revelations in SA nuclear deal

On September 30, the department of energy will release its much anticipated request for proposals for the nuclear build programme, which would “test the market”, Joemat-Pettersson told Parliament earlier. 

In a separate question, DA MP Gordon Mackay asked Joemat-Pettersson why government persisted with a nuclear build programme despite its obvious challenges and non-support for the type of energy generation. 

Joemat-Pettersson responded, saying the implementation of a nuclear plan was part of approved government policy, documented in the Nuclear energy Policy of 2008, the Integrated Resource Plan (IRP) for 2010 to 2030 and the National Development Plan (NDP). 

“The IRP allocates a total nuclear build programme capacity of 9 600MWs as part of a diverse energy mix,” Joemat-Pettersson said, but failed to mention that the IRP - which is supposed to be updated every three years - is by now outdated.

Industry experts have warned that South Africa may actually have a surplus of energy in the near future, while the NDP warns against the exorbitant costs of a nuclear build programme. 

Earlier in the week, Eskom CEO Brian Molefe also renewed the call for a nuclear build programme, saying that South Africa will by 2035 be in exactly the same predicament it was in 2008 when there had been a shortage of electricity supply if a decision on nuclear isn’t taken soon. 

READ: Molefe: No nuclear by 2035 could mean another power crunch

He also said there are financiers who would be willing to provide funding for a nuclear build programme and that it wouldn’t be necessary to call upon National Treasury to fund it. 

“It’s possible for nuclear to finance itself. Asking the fiscus for money is going overboard. We should be able to arrange some kind of funding for nuclear energy,” he said. 

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