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Eskom forges ahead with nuclear deal

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Eskom is forging ahead with its nuclear programme.
Eskom is forging ahead with its nuclear programme.

While the renewable industry and coal miners anxiously await government's decision on their fate in SA's energy mix, power utility Eskom is forging ahead with the nuclear programme.

Yesterday, Eskom signed a memorandum of understanding (MOU) with Coega Development Corporation (CDC) to cooperate in the development of the country's nuclear new build programme.

This is despite several non-governmental organisations trying to put spanners in Eskom's nuclear programme, saying the deal was shrouded in secrecy and lack of public consultation. They also suspect the programme opens doors to massive corruption that could bankrupt the country.

Eskom is forging ahead with its nuclear programme while the review of the integrated resource plan (IRP 2010) is still under way.

Under the MOU, Eskom and fellow state-owned enterprise CDC will work together in support of government's plans to build local capacity through supplier development and localisation around the unfolding infrastructure for the nuclear programme.

The MOU comes as coal miners are agitated about Eskom's plans to shut down a total of five coal-powered power stations in a bid to accommodate renewable energy independent power producers. Labour body the National Union of Mineworkers has threatened industrial action over Eskom's move, saying this will result in thousands of people losing their jobs.

At the same time, the renewable energy industry is crying foul over the power utility's delays in signing new power purchase agreements with them.

"We are gearing ourselves up in preparation for the nuclear new build programme in order to deliver the project within the set timelines and budget," says Abram Masango, Eskom's group executive for group capital.

"We want to ensure that South Africans get reliable, decarbonised base load power that will bring sustainable economic growth. In addition, it is critical to lay the foundation for local people to participate meaningfully during the various stages of the project by skilling them for jobs as well as business opportunities. We look forward to a productive working relationship under this memorandum with our counterparts, the CDC."

Christopher Mashigo, CDC's executive manager of business development, says the collaboration with Eskom is aligned with CDC's mandate, which is to drive the creation of an industrial complex to promote integration with industry and increase value-added production, while creating employment and the associated socio-economic benefits in the region in which it is located.

"An integrated energy plan carries with it the potential to catalyse the (re)industrialisation of the East Coast corridor manufacturing economy - translating to a higher and inclusive growth path and job creation," Mashigo says.

Eskom says it has applied for environmental authorisation for the first nuclear power reactors. The environmental assessment practitioners recommended the Thyspunt site, which is located in Jeffrey's Bay, in the Eastern Cape, as the preferred site, it points out.

The power utility says the success of the nuclear new build programme rests on the participation of various government departments and state-owned enterprises.

The MOU between Coega, whose shareholders are the Department of Trade and Industry and the Eastern Cape Provincial Government, and Eskom, whose shareholder is the Department of Public Enterprises, enhances the bond between these state entities, it notes.

Eskom is the designated procurer for the nuclear new build programme in terms of the amended section 34 determination as gazetted in December 2016.

The CDC is mandated to develop, grow and attract manufacturing capabilities in the Coega Industrial Development Zone in the Eastern Cape and has strategies that both parties can leverage for the nuclear new build programme.

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