South Africa’s Tough Road to a Nuclear Tender
- May 2, 2017 4:35 am GMT
- 169 views
South Africa’s High Court Sets Aside Nuclear Deal With Russia
(NucNet)(WNN): The High Court in South Africa has set aside a nuclear agreement between South Africa and Russia. Earthlife Africa (ELA) and the Southern African Faith Communities’ Environment Institute (SAFCEI) argued before the court that the processes followed by the government and state-owned utility Eskom leading up to the decision to sign agreements with Russia were not in line with the constitution.
Court papers submitted by SAFCEI said a decision to give the procurement process to Eskom – which operates the country’s only existing nuclear station, the two-unit Koeberg – was unlawful and made without regard to public input.
The judges agreed and ruled that the failure to include a public participation process rendered the National Energy Regulator of South Africa’s (Nersa) approval of both determinations procedurally unfair and in breach of national regulatory legislation.
WNN reported that the High Court ruled that an intergovernmental nuclear cooperation agreement between South Africa and Russia, signed by the energy minister at the time, Tina Joemat-Petterson, and the then Rosatom director-general Sergey Kirienko in 2014 was unconstitutional and unlawful, and should be set aside.
Nothing in the court ruling addressed the issue of the use of nuclear energy as such compared to renewables or coal. The ruling rests entirely on procedural matters.
Earthlife said the procurement deal for new nuclear would be the largest in the country’s history at an estimated $77bn (€72bn).
The government, which has said it wants to generate 9,600 MW of energy from as many as eight reactors, has put the total cost at anything from $37bn (€34.8bn) to $100bn (€94bn).
Eskom’s national grid would have to see substantial upgrades to get the electricity to customers. The main beneficiaries of the power would be South Africa’s heavy industry which has seen brownouts from the ability of current power stations to meet its needs.
South Africa’s Credit Rating Set to Junk Status
(AFP) South Africa’s ruling party said in response to the court ruling that the government will have to re-think its costly and contentious nuclear expansion program following last week’s change of of the country’s creditworthiness to junk status. Without a favorable credit rating, the question of financing the for entire nuclear program is more or less moot.
Within days of each other Fitch and Standard & Poor’s downgraded South African sovereign debt to junk status after President Jacob Zuma’s dramatic ministerial shake-up that saw respected finance minister Pravin Gordhan unceremoniously axed.
He’s the latest finance minister to run afoul of Zuma’s ambitions to execute the Rosatom deal which would put Russia in charge of the major elements of South Africa’s energy infrastructure and power generation capabilities for the next 60 years.
ANC’s head of economics Enoch Godongwana told reporters that “conditions have changed.”
“Surely in the light of the junk status we will have to … revise our expenditure patterns as government. If we do nuclear we must do it …at a scope and pace which is affordable.”
Currently, 90 percent of the country’s electricity is generated from coal-fired stations.
Whoops – Leading French Politician Needs to Rethink His Anti-Nuclear Stance
(Bloomberg) Macron May Have to Break His Campaign Promise on Nuclear Power.
French presidential favorite Emmanuel Macron may have to break a campaign pledge over the speed at which France reduces its dependence on nuclear power.
Macron, who topped the first round of voting in Sunday’s presidential election, has endorsed President Francois Hollande’s plan to reduce nuclear output from 72 percent of France’s total electricity generation last year to 50 percent by around 2025. There’s increasing speculation that goal may be unattainable.
Macron is backing a shift toward renewables, even as state-controlled utility Electricite de France SA pushes a 48 billion-euro ($52.2 billion) program to extend the lifespan of most of its 58 atomic reactors. Whoever wins will shape the pace of France’s energy transition, both through state incentives for renewables and financing for the next round of nuclear investment.
“The next president will soon have to decide on the long-term role of nuclear in France,” Ahmed Farman, an analyst at Jefferies International Ltd., wrote in a research note.
“The lack of a firm position on this issue may be because Mr. Macron is well aware that the 2025 target is highly ambitious.”
To achieve Macron’s energy goal by 2025, France would need to cut nuclear capacity by about 25 gigawatts, while adding about 75 gigawatts of renewables, according to Farman at Jefferies. That looks “quite challenging,” he said.
EDF, which has been forced to sell assets and new shares to bolster a balance sheet undermined by falling electricity prices, has said it will have to decide at the start of the next decade whether to build new atomic plants by 2030 to replace older ones.
That will further stretch the finances of the utility — 83 percent owned by the French state — and the government will need to provide more funding and incentives to underpin investment in new capacity, said Vincent Ayral, an analyst at JPMorgan Chase & Co.
“It is not clear how the company will be able to keep the lights on over the long term,” Ayral wrote in a note on Monday. “Yet EDF is systemic to France and, to a certain extent, to Europe: we believe a regulatory intervention is needed.”
French Academy of Sciences Questions Wisdom of Macron’s Energy Policy
(WNN) The French Academy of Sciences has put a spotlight on a major contradiction in France’s energy policies. It said France cannot achieve a significant reduction in emissions of greenhouse gases from electricity production while also reducing the share of nuclear in its energy mix.
France’s National Assembly gave final approval in July 2016 of the country’s Energy Transition for Green Growth bill. The overall objectives of the bill include:
- a 40% reduction in greenhouse gas emissions by 2030
- a 75% reduction by 2050, compared with 1990 levels
- halving overall energy consumption by 2050 compared with 2012
- increasing renewable energy’s share of final energy consumption to 32%; and
- cutting the share of nuclear in electricity generation from almost 75% to 50% by 2025.
In an April 19th statement, the Academy of Sciences said the debate about France’s energy transition was incomplete.
“In reality, energy policy programs should take better account of physical, technological and economic constraints,” it said.
“In the current debate, our fellow citizens might be led to believe it would be possible to develop renewable energy as a way to decarbonise the system while removing both fossil fuels and nuclear.”
“Simple common sense leads one to conclude that production of electricity that can meet the country’s needs requires the availability of ‘on demand’ energies, which do not suffer from intermittency and which can be called upon at all times,” it said.
This means, in the absence of energy storage solutions, significant use will need to be made of thermal and nuclear power plants if France is to increase its use of renewable energy.
In other words, good luck with your delusions about renewable energy if you want to keep the lights on.
Westinghouse DIP Loan Seen as Intellectual-Property Grab
(Bloomberg) An $800 million loan proposed to keep Westinghouse Electric Co. alive in bankruptcy is drawing fire from utility owner Southern Co., which warned that lender Apollo Global Management LLC would gain the keys to intellectual property and the ultimate fate over stalled U.S. nuclear projects.
The loan, which has yet to win court approval, appears to use valuable intellectual property as collateral. That means New York-based Apollo, led by billionaire Leon Black, could disrupt or halt completion of four nuclear plants if it foreclosed on the debt, Southern’s Georgia Power Co. and the city of Dalton, Georgia, said in objections to the loan filed in Manhattan bankruptcy court Wednesday.
“The possibility would exist that the DIP lenders would later foreclose on the intellectual property, which could seriously disrupt or even potentially halt construction of the project,” the owners said.
IAEA Says $80 Billion Needed to Meet Climate Change Goals
(Reuters) Tackling climate change and achieving the Paris Agreement temperature rise target of 2 degrees Celsius by 2030 requires a hefty investment in nuclear power, Dohee Hahn, a senior official from the International Atomic Energy Agency (IAEA), said at a conference.
Dohee Hahn told a nuclear industry conference that between 10 and 20 reactors will need to be built every year through 2030, if the global temperature rise is to be held within 2 degrees.
The agency estimates that total global nuclear capacity needs to reach 862 gigawatts by 2040, up from 376 gigawatts in 2014, in order to meet the goals set in the Paris agreement.
He said the nuclear energy industry needs an annual investment of $80 billion in order to meet climate change goals. At $4 billion a reactor, that would work out to 20 1000 MW units a year and over 50 years, 1000 reactors.
Bearing in mind the service life of a reactor is currently pegged at 40-60 years, the investment would have to be a continuing commitment. Along with it, reactors would need from being stick built one at a time to being fabricated in system units in factories to drive down costs. This level of investment would justify the developing of the factory production lines.
China nuclear firm urges more Hualong One Units built at home
(Reuters) A Chinese nuclear firm has urged the government to approve the large-scale construction of the country’s homegrown third-generation “Hualong One” reactor to help cut costs and boost its competitiveness.
China National Nuclear Power Co. Ltd (CNNP) warned nuclear’s competitiveness against coal is falling and nuclear power needs the benefits of economies of scale.
“We now have a Hualong One demonstration project, we have units under construction at Fuqing and Fangchenggang and we just hope that more can be built in order to reduce costs and make it more economic,” Luo Xiaowei, CNNP board secretary, told Reuters.
In China, which currently has 36 operational nuclear reactors, the Hualong One is competing with other third-generation technology reactors for a share of 100-150 new reactors planned to come into operation by 2030.
Third-generation reactor projects in China include the world’s first four AP1000s, designed by Westinghouse and expected to go into full operation later this year, and two European Pressurised Reactors, designed by France’s Areva, in the southeast province of Guangdong.
CNNP officials says the Hualong One, however, is the “most feasible option” for China as it tries to scale up its nuclear capacity and strengthen its position in the international reactor market.
China aims to raise nuclear installed capacity to 58 gigawatts by the end of 2020 and it has set a target of 200 gigawatts by the end of 2030.
Royal Academy Calls On UK Gov’t To Consider ‘Alternative Route’ Of SMRs
(NucNet) There is a serious risk that new nuclear reactors may not be built in time to even replace the existing capacity of nuclear generation in the UK. An alternative route could be offered by small modular reactors (SMRs), the UK engineering profession said in a report on 24 April 2017.
In its feedback on the government’s industrial strategy, which was published in January 2017, the Royal Academy of Engineering said the smaller size and modular design of SMRs could offer much lower capital hurdles and shorter delivery times, and small reactors have operated for years in certain applications such as nuclear submarines.
The academy said the commercial risks are high but the UK has expertise in this field and the potential rewards both in terms of the energy transition and financial returns are large.
According to the academy, the UK’s nuclear energy industry struggles with an ageing workforce and relies on imported reactor designs, which is a lost opportunity for the UK’s historically strong engineering and design capacity in this field.
In addition, the new-build program is also not progressing as expected, with few global vendors, most of whom are struggling to finance the extremely high capital costs of the latest generation of reactors.
The academy said there is an opportunity for the UK supply chain to play a part in the development of SMRs. However, this will probably need some form of “catalytic activity” from government and a clearer focus from the industry on commercially viable solutions.
“The UK could use its history of reactor development and international reputation for safety and quality to develop and promulgate UK participation in technology for a worldwide market,” the academy said. The report is online: http://bit.ly/2p8UX2u
Mitsubishi Heavy doubling down on Areva with fresh investment
(Nikkei Asian Review) It takes a stake in struggling firm which signals commitment to nuclear operations.
Mitsubishi Heavy Industries has reached a broad agreement to purchase about 15% of French nuclear energy giant Areva’s reactor unit, venturing deeper into a business with uncertain prospects that has sent others pulling out.
The Japanese engineering firm and Electricite de France (EDF), the state-backed utility that has agreed to acquire reactor maker Areva NP, have reached a deal that will have Mitsubishi Heavy increase its investment by $366 million for the stake.
China’s state-owned China General Nuclear Power, which is developing reactors based on French technology and runs 19 power plants, is also in talks to take around a 15% stake in Areva NP. Sources close to the matter say a basic agreement is targeted for May, and that other companies could join the effort.
Tepco contemplates 2019 restart for giant Kashiwazaki-Kariwa nuclear plant
(Japan Times) Tokyo Electric Power Company (TEPCO) is planning to restart operations at its Kashiwazaki-Kariwa plant in Niigata Prefecture in stages from April 2019. This is the latest projection of a start date. Previous efforts have been thwarted by factors including intense local opposition.
Earlier effort have focused on the two newest units, but time time TEPCO is considering reopening four of the seven reactors at the plant over a roughly three-year period through May 2021. The utility will present the proposed schedule in a restructuring plan due to be submitted to the government, possibly by the end of the month.
According to the sources, TEPCO, which was effectively nationalized in the wake of the nuclear crisis, is likely to present two scenarios in the restructuring plan: One for rebooting four reactors and one for rebooting all seven.
Under the four-unit plan, Tepco intends to first restart reactors 6 and 7, which are being scrutinized by the Nuclear Regulation Authority. Unit 7 would resume from April 2019 and unit 6 the following May.
Reactor 1 would be set for restart in April 2021, with unit 5 following the next month, the sources said.
Under the alternative scenario, the remaining three units would be brought back online, although a specific time frame for each reactor has yet to be fixed, the sources said.
The Kashiwazaki-Kariwa complex is the world’s largest nuclear plant by capacity when all seven BWR type units are in online.
Tepco hopes the restart will help stabilize its finances as it deals with up to $202 billion in decommissioning and compensation costs from the Fukushima disaster.
But it’s unclear whether Tepco will be able to go forward with the plan, because Niigata Gov. Ryuichi Yoneyama is opposed to restarting the reactors. Local approval counts for a lot in Japan and the reactors cannot be restarted without it.
# # #
Filed under: Nuclear