Why Eskom's nuclear plan is toxic - TechCentral

Why Eskom’s nuclear plan is toxic

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Cabinet is to consider a proposal that a mooted nuclear power deal for the country be financed through the state-owned power utility Eskom. This is the latest twist in South Africa’s controversial efforts to expand its nuclear power capability by commissioning up to 9,6GW of energy from six nuclear power stations. The decision has been mired in controversy and still hangs in the balance and the offer by Eskom to foot the bill raises more questions than it provides answers.

Recent claims by Eskom’s management fail to adequately address any of the fundamental criticisms of the proposed nuclear programme.

Statements that Eskom can “finance nuclear on its own”, or absorb the risks from an incorrect decision, don’t add up economically or financially, and are misleading.

Furthermore, changes in Eskom’s rationale for justifying nuclear procurement over the last two years call into question the merits and motives of these arguments. Its claims about financing also raise serious questions about the arguments it presented to parliament last year to justify a R23bn cash injection and writing off a R60bn loan.

The right decision would be for cabinet to defer further consideration of the programme for at least two years. In addition, Eskom should account to parliament on discrepancies in its statements about its financial situation.

The three main problems with the case for nuclear procurement are well-established.

The actual power probably will not be needed. Recent trends in economic growth and electricity demand are much lower than the original forecasts on which the supposed need for nuclear power were based.

The programme is also likely to be very costly although there are still no credible, government cost estimates in the public domain. Many energy experts have argued that even if additional capacity was needed, other energy sources may be cheaper or more appropriate.

Finally, the combination of insufficient demand and costly supply means that nuclear poses a serious threat to the future stability of the country’s public finances and economic growth.

An indicator of problematic motives behind the push for nuclear is the way in which the arguments made for it keep shifting.

Late last year, Eskom CEO Brian Molefe told parliament that procurement of nuclear was “urgent” and feasible. Molefe argued that nuclear costs are lower than critics imply and concerns about financing reflect a “pedestrian” attitude.

After this, Eskom decided on a new line of attack: trying to limit procurement of power from independent renewable energy producers. In a letter to the minister of public enterprises, Eskom questioned the merits of renewable energy programmes that had been approved and were already proceeding. It has subsequently become clear that Eskom is defying national policy decisions by not signing renewable energy agreements.

In doing so, Eskom is attempting to obstruct the procurement of other forms of energy to “create” a need for nuclear.

Eskom’s finances

Eskom’s statements about “independent” financing are similarly misleading. Eskom has been, and continues to be, heavily reliant on government support. As of February 2016, Eskom held R350bn of debt guarantees from the national treasury, of which it had used R168bn.

Worse, in 2015 parliament approved a R23bn cash transfer to Eskom and an eight-year-old R60bn loan was written off. One estimate of the additional cost of foregone interest payments is a massive R82,6bn.

Eskom won the concessions because it claimed that it needed support to stabilise its balance sheet. And its CEO accepted a large bonus for the improvement in Eskom’s finances.

Yet Eskom now claims it will have an excess of R150bn in cash, and can borrow to fund the nuclear build programme. The appropriations committees of parliament that approved the 2015 financing for Eskom should demand an explanation for this apparent contradiction.

Threat to the economy

Even if Eskom was not receiving government support, procurement of nuclear would still be a threat to the economy and an indirect threat to public finances. As the latest medium-term budget showed, a decline in economic growth has a knock-on effect on government revenue.

The dynamics that would unfold have been experienced in the country before following the introduction of e-tolls. The costs were passed onto motorists who then refused to pay, requiring significant financial intervention by the government. The danger is that this could happen on a much larger scale with the nuclear build.

Having financed the procurement of costly, unnecessary energy capacity using power-purchase agreements, Eskom would have to pay for the energy even if consumers do not need it. If tariffs are insufficient, then Eskom’s balance sheet would be compromised and national government would have to step in. And it would, because Eskom is too big to fail.

Alternatively, if higher tariffs are approved — in advance, or at the time — by the regulator, these will have a very negative effect on citizens’ welfare and on economic growth. At best this would reduce government revenue and compromise efforts to improve the lives of all citizens.

At worst, it could lead to social instability and a refusal to pay exorbitantly high tariffs, leading to a collapse in Eskom’s finances and the government — again — having to step in.

It should therefore be clear that the case for proceeding with the procurement of nuclear power at this point, whether through Eskom or another mechanism, is fundamentally flawed. The rational and responsible decision by cabinet would be to halt the process.

If economic growth and energy demand increases significantly over the next few years, the matter could be revisited based on an appropriately updated Integrated Resource Plan that uses credible forecasts of future energy needs.The Conversation

  • Seán Mfundza Muller is senior lecturer in economics, University of Johannesburg
  • This article was originally published on The Conversation

41 Comments

  1. however, in term of gigawatt produced, it is safer than any other source of energy, safer than renewables.
    death/TWh: coal 161.00, oil 36.00, solar 0.44 , wind 0.15, hydro 0.10, nuclear 0.04

  2. Tokolosh Nkosi on

    But when nuclear goes wrong, it goes very wrong. And with our government it will!

  3. Indeed.
    But even going wrong, it causes fewer fatalities per terawatt-hour in comparison to other sources of energy, for example:
    No one has died from Fukushima radiation exposure.
    “..dissolving all of the fuel of all three operating reactors, plus the entire contents of all of the spent fuel pools at Fukushima into the waters of the northern Pacific would still give a person swimming in the ocean off Hawaii, Alaska, or California about one billionth the amount of radiation dose needed to cause any harm.”
    “..radioactivity of the cesium was lower than the radioactivity content of the natural potassium in the fish.”

    Natural radioactivity in some places on Earth are more intense(up to 40 times) than Fukushima and no problem for plants, animals and humans.
    In Fukushima 20 mSv while on the beach in Guarapari Brazil, the dose per annum is up to 800 mSv in some spots.

    Carbon-free nuclear is worth the price, it is the most ecologically friendly source of clean energy, because it takes few land area, it does not have exposed wind blades to slaughter bird and bats in midair, it does not ruin natural landscapes in large-scale, it is much more environmentally friendly than renewables per unit of energy produced.

  4. Nobody has died from radioactive waste.
    “The more radioactive an isotope is, the faster it decays.”
    “Nuclear wastes are neither particularly hazardous nor hard to manage relative to other toxic industrial wastes.”
    “Unlike other industrial wastes, the level of hazard of all nuclear waste – its radioactivity – diminishes with time.”
    “The radioactive elements in the spent fuel have short half lives, and the radioactivity of the spent fuel is down to one percent of the original level in 300 years. The spent fuel casks can be safely stored”

    Radioactive waste is more a political/ideological than technical issue; it is always applied two sets of standards, for example, renewable through mining activities(rare earth metals) produces much more radioactive waste per gigawatt installed than nuclear power.

    search for:
    “..one ton of rare earth minerals produces about one ton of radioactive waste..”
    “..wind industry may well have created more radioactive waste last year than our entire nuclear industry produced in spent fuel.”
    “between 4.9 million and 6.1 million pounds of radioactive waste were created to make these wind turbines”
    “Fracking Creates Massive Radioactive Waste Problem”
    “byproducts of hydraulic fracturing, or fracking, create radioactive waste”
    “Coal Ash Is More Radioactive Than Nuclear Waste”

  5. Now we understand why Molefe is so keen on nuclear following the release of the PPs report. How does the man manage to look at himself in the mirror every morning?

  6. Two names put your stupid and pathetic argument to rest, you know what they are, but just to bring you into the universe the rest of us on this site inhabit I will repeat them, write ’em down.
    Chernobyl and Fukushima.
    Who’s funding you? That Klown Shoes minister Petterson who has managed to monumentally stuff up every single post her corrupt boss, one Jacob Gupta-gofer Zuma put her in.
    You want Tina Petterson to run NUKES? God help us all.

  7. Andrew Fraser on

    The reason for Eskom and co’s love for nuclear has nothing to do with ecological reasons. For the massive investment required for nuclear and the long lead times to install, there are better ways to invest in the ecology. e.g. cleaning up the emissions from the existing coal generation, and investment in renewables. Their excitement for nuclear is more aligned to the massive opportunities for graft that exist in a mega-project.

  8. Tokolosh Nkosi on

    Our current Government can not do this ethically, it is going to be waste of money.

  9. “It seems that the less people understand radiation and its effects the more likely they are to be afraid of it.”
    “No radiological health effects have yet to result from the Fukushima disaster – neither cancers, deaths nor radiation sickness”
    “Fukushima-grown food has no detectable radiation from the accident. The fishing stocks off the Japanese coast are not contaminated. The ocean off the coast of Fukushima is not contaminated. “

  10. “Sun and wind”, ecologically hypocritical means of energy production, bird-choppers/landscape-destroyers, that need fossil fuel power plants to back them up to compensate intermittencies.

  11. “Japan’s radiation disaster toll: none dead, none sick”
    In some places on Earth, the natural radiation is 160 times higher than Chernobyl, forty times than Fukushima, and even so, poses no problem for human health.
    800 mSv Guarapari Beach(natural)
    20 mSv Fukushima(manmade)
    5 mSv Chernobyl
    Fear-mongers and sensationalist mass media have induced much more deaths than radiation.

  12. No one funds me; I just want to expose pseudo-environmentalists that promote ecologically hypocritical means of energy production(wind/solar bird-choppers/landscape-destroyers backed by fossil fuels) that are worse for the environment and cause more deaths in terms of gigawatt produced than carbon-free nuclear.

  13. Unethical are the anti-nuclear fearmongers that act as pro-renewable but are in fact pro-fossil fuels. They are completely dishonest and divorced from reality, they fabricate fictional data on the fly, create scary tales and conspiracy theories to lure taxpayers in order to waste their money with eco-hypocritical wind/solar bird-choppers/landscape-destroyers backed by coal and natural gas/fracking to compensate intermittencies.

  14. On the other side, demagogic politicians want to replace carbon-free nuclear power by wind/solar bird-choppers/landscape-destroyers backed by coal and natural gas/fracking to compensate intermittencies just to satisfy the fossil fuel industry’s interests, and it clearly has nothing to do with the environment or saving the planet.

  15. “Nuclear power is not the bogey that anti-nuclear groups have led us to believe. It has the lowest death rate per kilowatt hour of any generating technology including wind and solar.”
    “Nuclear power is as clean, or cleaner than other so called “renewable” energy sources, so if the goal is clean, low carbon energy, then nuclear power should be included in the clean energy standard, if on the other hand you don’t really care about the environment or carbon emissions but are just concerned with appearances and /or continuing fossil fuel profits, then you will oppose…”

    “Suggesting that renewables will let us phase rapidly off fossil fuels in the United States, China, India, or the world as a whole is almost the equivalent of believing in the Easter Bunny and Tooth Fairy.” – James Hanson, climate scientist and Environmental Progress Science Advisor
    “In the face of climate change, you cannot be anti-nuclear unless you are pro-fossil, pro-poverty, and pro-air-pollution.” – Heather Matteson

  16. What about the cost over a nuclear plant’s entire lifetime? It’s phenomenal. You can’t simply go by the cost to install the capacity. Its expensive to deal with waste and decommissioning. Not to mention that infrastructure costs for distributed renewable capacity is very attractive. A town needs power? No problem just build a solar /wind installation right next to it, local distribution, local maintenance. For nuclear you have to install and maintain thousands of km of power lines.

    The safety might be great even counting disasters, but the cost of disasters are also on an entirely different level.

  17. What about the hidden costs of solar/wind? For each each gigawatt of wind/solar it is needed a gigawatt from fossil fuel power plants to compensate intermittencies because batteries/energy storage is quite expensive. Aside ruination of natural landscapes and fragmentation of wildlife’s habitats.
    Intermittent power is almost useless, worse yet backed up by fossil fuels.
    “Wind and solar energy sources vary rather unpredictably in output during the day, from 0% to 100%.”
    Renewable is the most chaotic way to produce energy, and a cheap way to reduce this chaoticness on the grid is with flexible fossil-fuel power plants instead of batteries. Renewable causes more impact on the environment than carbon-free nuclear power.

    There was no disaster, no one was killed by radiation at Fukushima Daiichi power plant, the tsunami is that was the real killer, and the fear-mongers and sensationalist mass media, by spreading misinformation among civilians, have induced more deaths than radiation.
    “The quake and tsunami kill 15,000 people, but NOT ONE gets killed by radiation, not even the guys working in ankle-deep contaminated water afterwards. Fukushima was a massive confirmation of the safety of nuclear power.”

  18. I think you are not looking at reality. Fukushima happened 5 years ago. There are still entire towns close by which have not been deemed habitable yet. They are still trying to figure out how to remove tons of fuel from the reactors – They are not even sure yet if some of the fuel has burned through containment vessels in some of the reactors because they cannot get observers in safely. They tried to develop some robots to do the task, but they have their limitations. If that’s not expensive then I’m not sure what is. But then… like you said ultimately the tsunami was the major disaster – Fukushima is just one of the more expensive secondary disasters. But let’s not compare disaster sizes here -It was a disaster in its own right.

    Yes batteries are expensive. Yes solar/wind is not consistent -This means you do need batteries to back up solar and wind. But here’s the thing… Its not a loss. Many companies are right now profitably providing power to people from solar/wind backed up by utility scale power storage solutions.

    It’s just not AS profitable as some other forms of power generation. Just like using sunflower seed oil (amongst a wide variety of choices) is not AS profitable for the manufacturers of many of the product we use daily as Oil Palm substitutes. And so… Hello and goodbye some of the most important ecosystems on this planet. Not because there are no alternatives – Because companies want to maximise their profits (great) at all costs (bad).

    And solar/wind+storage can scale from individual homes all the way to entire towns (you know those things Japan had to evacuate for the last 5 years since Fukushima).

  19. It is clean, much cleaner than coal, particularly from an environmental aspect.
    It is safe provided you don’t have idiots running the show. That was what happened at Chernobyl… The likelihood of that these days, especially with advanced software and safety features is fairly slim at worst.

  20. By just taking a binary position on this and spouting nonsense about bird murdering wind generation, you do your argument no favours. There is no need to frack to obtain natural gas for Gas Turbine peak generation, there are huge reserves off Mozambique. Also, Burning natural gas is actually positive for the greenhouse effect. Methane acts as a greenhouse gas more than CO2. And that’s not even considering the possibilities of biogas production.

    You’re also ignoring a key issue: Going forward grid power is going to be less important than it was in the past as local generation and storage becomes more affordable. Adding 9.6GW when it seems that demand is stable or even dropping is poor business. Even now, without Kusile and Medupi fully online, Eskom stated today that they have excess capacity.

    In the 10 Eskom-years (that’s 15 years in normal time) that it’ll take to get a Nuclear plant online, renewable costs would have dropped even further, and local generation would be driving growth – making the Eskom investments white elephants (while also helping to bankrupt the country).

    The reason to avoid nuclear (much like Japan and Germany have decided to do) is not ecological, or due to fears of accidents or waste disposal. All of those are, as you stated, overblown and no worse than alternatives. The reason to avoid nuclear is that it doesn’t make economic sense.

  21. Radioactivity is below the background radiation levels from naturally occurring radioisotopes.
    A disaster where no one was killed by radiation, the tsunami is that caused the deaths, and fearmongers don’t stop spreading misinformation.
    “Anti-science activism and statistics-illiterate fear-mongering are killing millions of people.”
    “solar/wind+storage”, the energy storage is quite expensive, thus it is used fossil fuels as backup instead. So renewable(bird-choppers/landscape-destroyers) is neither carbon-free nor ecologically friendly.
    Renewables use rare-earth metals which mining produces more tons of radioactive waste than carbon-free nuclear power
    “..wind industry may well have created more radioactive waste last year than our entire nuclear industry produced in spent fuel.”
    “..one ton of rare earth minerals produces about one ton of radioactive waste..”
    solar panels’ carcinogenics: hexavalent chromium, selenium, gallium arsenide, brominated diphenylethers, polybrominated biphenyls, trihalomethane (THM).

  22. but nuclear makes environmental sense, it is proven the only way to stop global warming, because renewable has proven to be infective because it depends strongly on fossil fuels

  23. Natural background ionising radiation exposure levels is about 1-3 mSv/Year (per year) . Around Fukushima within the 20-30km zone that was evacuated there are locations which have exposure anywhere from 26mSv/h all the way northwards of 300mSv/h (per hour) .

    Even workers in nuclear power plants are legally limited to no more than 50mSv/year. In most countries.

  24. Nuclear power plants produce ^highly radioactive^ waste (Around 3% of the total waste – the rest is not so bad). High level radioactive waste takes many thousands of years to decay to the same level as uranium ore (which itself has substantial radio-toxicity). That is the scary stuff – And it exists. Already. And it will exist in a massively toxic state until long after the companies/governments which host the bunkers where its currently stored will exist – Possibly (probably) beyond the future lifespan of humanity.

    The waste from rare earth refining has been found to have exposure levels several times as high as any reasonable legal limit. Thus elevating cancer risk to an extent. The problem is of course that the Chinese mines (where the majority of rare earths have been mined for the last few decades) did the worst thing possible. Instead of storing the radio-active portion of the waste in sealed near surface bunkers for a few decades they went ahead and dumped it all in tailing ponds so now its making its way into ground water. It was just max profits and the rest be damned all the way. And yes… Its a real problem.

  25. Around Fukushima Daiichi is 20mSv/year that is below natural radiation e.g. Kerala(35 mSv) and Guarapari(800 mSv/year) beaches and city of Ramsar(700 mSv).

    “Data at the end of May (with most I-131 gone by decay) showed that about half of the 20 km evacuation zone and a similar area to the NW, total about 1000 sq km, would give an annual dose of 20 mSv to March 2012.”
    “the radiation in the current 20 km exclusion zone will reach the equivalent of 20 millisieverts a year”
    “through the environment or their food, to more than 10 mSv in their entire lifetime. This can be compared to the 170 mSv they would receive during their lifetimes from natural sources even if the accident had never happened.”

  26. ^highly radioactive^ waste has application in radiotherapy, and radiation therapy has saved millions lives from cancer.
    The remaining of nuclear waste has low radioactivity, almost no gamma radiation and no neutron release, it emits mainly alpha and beta particles that are electrically charged and be easily stopped by a thin paper.
    “Radiotherapy can be used to treat some medical conditions, especially cancer, using radiation to weaken or destroy particular targeted cells.”
    “Tens of millions of nuclear medicine procedures are performed each year, and demand for radioisotopes is increasing rapidly.”

    The activity of mining rare-earth metals to produce components for wind and solar produces much more tons of radioactive wastes per gigawatt installed, because rare-earth metals have traces of naturally-occurring radioactive elements: polonium, uranium and thorium.

    search for:
    “a solar powered world produces 63,000 times the waste of a nuclear powered world.”

  27. Andrew Fraser on

    You haven’t read my post. It doesn’t matter if it is more environmentally friendly (which is debatable), than most. It definitely isn’t the “only proven” way – energy storage schemes exist (pumped water, molten salt etc…). It simply isn’t economically feasible to build 9.6GW of nuclear generation.

    We won’t need it, and it’ll be too expensive.

  28. It is worth the price, carbon-free nuclear power is the only way to stop global warming.
    “Suggesting that renewables will let us phase rapidly off fossil fuels in the United States, China, India, or the world as a whole is almost the equivalent of believing in the Easter Bunny and Tooth Fairy.” – James Hanson, climate scientist and Environmental Progress Science Advisor
    “In the face of climate change, you cannot be anti-nuclear unless you are pro-fossil, pro-poverty, and pro-air-pollution.” – Heather Matteson

    Renewable is not the answer. Components of renewables are not manufactured in wind/solar-powered factories.
    wind/solar is not carbon-free, it requires fossil fuels to mine, manufacture, transport, and to compensate intermittencies; it slaughters millions of birds and bats with wind blades and solar mirrors, it needs large lands/offshore areas for commercial production of electricity, destroys natural landscapes and wildlife’s habitats, and releases harmful chemical carcinogenics as a result of natural deterioration; wind/solar pollutes and kills much more per terawatt-hour produced than nuclear power.
    Death/TWh: Coal 161.00, Oil 36.00, Solar 0.44 , Wind 0.15, Hydro 0.10, Nuclear 0.04
    Nuclear power is statistically proven the most eco-friendly, the best carbon-free source of energy to fight climate change.

  29. Quite correct. The 20th century notion of the national grid is dissolving slowly. It will take decades yet but it’s happening. Future “base load” power generation could one day be history.

  30. You’re not reading my posts. It doesn’t matter if nuclear is the second coming of Christ. It’s too expensive and slow to deploy.

    Arguing about the geographical requirements of renewables? Have you been to the Northern Cape? A passive solar farm utilising molten salt takes up about 1500 hectares. Not too serious when you’re installing in a semi desert. No trees to cut down and local fauna are hardly impacted except for the occasional fried bird.

    Also, arguing about the carbon costs of renewables without taking into account the ecological cost of uranium is specious.

  31. “desert land is special, and must also be protected”
    Concentrated solar thermal power: the solar mirrors cook/incinerate bats and birds in mid-flight, a horrible death, it is not ecologically friendly, it takes large land areas and disturbs wildlife’s habitats.
    Renewable is a pipe dream (in the reality ugly bird-choppers/landscape-destroyers backed by coal and natural gas/fracking to compensate intermittencies).
    Compact nuclear power plants have no exposed wind blades and no solar mirrors to slaughter/incinerate millions of innocent birds and bats in midair as wind/solar does. It needs much less mining per gigawatt installed than renewables. Nuclear power is the most ecologically friendly source of carbon-free energy.

  32. Andrew Fraser on

    You aren’t reading or thinking. Your binary thinking about nuclear is just the same as the tree huggers. No point debating with you.

  33. A South African engineer working for Eskom told me that Koeberg has the lowest operating cost of all the SA power stations. This, in addition to the clean environmental footprint and good safety record (as repeatedly pointed out by TimS above), indicates that nuclear is the way to go.

  34. I used to support the nuclear option. Then an engineer explained to me that

    a) nuclear projects have a very slow turnaround time.
    b) up to half of all nuclear projects never deliver any power due to project complications.
    c) the nuclear skills pool is growing smaller and as such more expensive (also, I don’t see much talk from Eskom about skills transfer).

    d) nuclear is very centralised, whereas the trend is toward creating more decentralised systems.

    I still think nuclear has a place in this world. But the government has a poor track record in establishing alternative and smaller energy generation. I don’t trust them to be honest about nuclear’s delivery impact and time frame. I think they are taking an easy choice, easy in part because they aren’t concerned about the fiscal impact on the rest of the country.

    I honestly believe this has more to do with cutting a deal with Russia and getting kickbacks than a concerted effort to address SA’s power future. I don’t see them push for solar and gas nearly as hard. There is nothing balanced about what is being proposed around nuclear.

    So, I support nuclear as a power generation source, but I oppose its use in South Africa – at least until more transparency is applied and more alternatives are also introduced in tandem.

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