Eskom to be nuclear procurement agent, Gordhan confirms

Finance Minister Pravin Gordhan says Treasury will be watching the process closely.

FILE: Eskom's head office at Megawatt Park in Johannesburg. Picture: Reinart Toerien/EWN

CAPE TOWN - Finance Minister Pravin Gordhan says it's been confirmed that Eskom will be the procurement agent for the government's nuclear power build.

The plan is to provide 9.6 gigawatts of nuclear energy, but there are question marks over whether the country needs it or can even afford it.

The integrated resource plan, which determines energy needs and how to meet them, was last updated in 2010.

Gordhan dealt with the issue when he delivered his mid-term budget review in Parliament yesterday.

The Finance Minister says Treasury will be watching the process closely.

"The Treasury will work with Public Enterprises Minister Lynne Brown's department and Eskom to ensure that the scale and phasing in of the programme are in South Africa's best interests, and that the procurement arrangements are transparent and compliant with the law."

Gordhan also stressed that the renewable energy programme was still government policy.

"Contrary to the views of some, these are sound and sensible long-term investments, consistent with our climate-change commitments."

Eskom is on record as saying renewable energy tariffs paid to independent power producers are too expensive, and has been arguing strongly in favour of the nuclear build programme, saying it will finance it itself by borrowing against its balance sheet.

Treasury, on the other hand, says a revised integrated resource plan should decide energy needs, warning that an oversupply and idle capacity could lead to higher electricity prices and hobble the economy.