A sign prohibiting entry to South Africa’s Koeberg nuclear power plant near Cape Town.

Reuters/Johannesburg

Fears are growing in South Africa that agreements to build nuclear power plants that could be the most expensive procurement in the country’s history will be made behind closed doors, without the necessary public scrutiny.
Among those voicing concern, two government sources say the Treasury is not being included in procurement discussions, despite the massive budgetary implications of a project that experts say may cost as much as $100bn.
Construction on the first plant is due to start next year, breakneck speed compared with the years of regulatory and environmental checks for nuclear projects in countries such as Britain and the United States.
The Democratic Alliance, the main opposition party, believes the pace of the deal will prevent proper analysis before contracts are signed and huge sums of money change hands.
“The whole deal has been veiled in secrecy. We have no details on what we’re buying, how much it’s going to cost or how we’re going to pay for it,” shadow energy minister Gordon Mackay said.
The Department of Energy (DoE) did not respond to requests for comment. It has said several times the procurement process will be transparent and follow procedure.
Finance Minister Nhlanhla Nene was forced this week to deny reports of tensions with the DoE over the plans and said the Treasury was playing a supporting role in the procurement process.
Pretoria has already signed non-binding inter-government agreements for nuclear power support from several countries including France, China and South Korea.
South Africa’s President Jacob Zuma said this week the nuclear plan was at an “advanced stage” and the procurement process should be completed by March.
Following meetings between Zuma and Russian President Vladimir Putin last year, the Russian atomic agency Rosatom said it had agreed a $10bn contract to build power stations.
However, the DoE denied an agreement had been reached, raising public suspicion in South Africa of backroom deal-making - an accusation often levelled against the ruling African National Congress under Zuma’s tenure.
“The nuclear deal is of huge concern given South Africa’s history of endemic corruption,” said Andrew Feinstein, a former ANC lawmaker and now executive director of Corruption Watch UK.
Feinstein is the author of a book about alleged widespread graft in a $4.8bn arms deal during the late-1990s.
“I fear that the corruption in this deal might dwarf the arms deal,” he said.
Africa’s most developed economy is in the midst of a chronic electricity crisis as it scrambles to stem power shortages that are increasing costs for industry and discouraging investment.
Part of its response is to build the new nuclear plants that would add 9,600 megawatts (MW) by 2030. Its only existing plant, which began operating in 1984, produces 1,600 MW. The country relies mostly on coal for its 42,000 MW generating capacity.
A 2013 study by the University of Cape Town’s Energy Research Centre found more nuclear power was not needed and would not be cost-effective, based on an estimated installed cost of $7,000 per kilowatt.
The DoE has estimated the build would cost $4,200 per kilowatt. Energy experts say this is optimistic and the calculations are based on out-of-date assumptions.