by Dr. Kelvin Kemm, CEO of Stratek Business Strategy Consultants
Nuclear power has been coming back into the international news during the past year. Some of the impetus for this has been a spin off from the international climate change debate, in which fossil fuels such as coal, oil and natural gas have been targeted for emitting carbon dioxide.
Fossil fuels have to emit carbon dioxide, as the fundamental heat equation is the combustion of carbon, which is carbon plus oxygen, which equals heat and carbon dioxide, no way around that.
Nuclear power, on the other hand, emits no gasses or liquid waste. But that is not the only reason that nuclear is gaining increased attention. A fundamental factor relating to nuclear power is, that it is just plain and simply profitable. Many nuclear power stations built in the 1970s are now running very profitably, thanks largely to the fact that nuclear power uses so little uranium that any price change in the uranium as a commodity, makes essentially no difference to the electricity price. The older nuclear stations are now running efficiently with a low and stable fuel cost.
Opening a nuclear forum in Pretoria in November, the Minister of Energy, Dipuo Peters, said that what the country needs is a national electricity supply that is affordable and accessible. Clearly this is important, as an input into the economy.
Nuclear power is often labelled as expensive but it is not, as the nuclear reactors of the world are now proving. A nuclear power station is generally more expensive to build than a coal-fired power station. One reason is that nuclear has to conform to engineering specifications that are much more stringent than for other industries. Much of which is not really necessary. For example, why should a steam pipe in a nuclear power station have to conform to a higher specifcation than a steam pipe in a coal-fired power station, when the two pipes do the same job.
Therefore in contracting for a nuclear station it is important to decide exactly what you want and why. It seems that Eskom asked the bidders to provide very much of a turnkey power station, which meant that the price was at the highest it could be.
What we need is to accept project risk locally, introduce maximum local content, and take some responsibility for delivery schedules. Apparently such an approach, could cut billions off the price tag.
Dr. Rita Bowser of Westinghouse, has pointed out that Westinghouse is building their new reactor to be very modular and reproductable, so to speak. In the 1970s, US power utilities all competed with one another, using good free market principles, but they built a spectrum of nuclear reactor variants. This resulted in a huge headache for the regualtory authorities, because every reactor was unique. This contributed to delivery delays, and cost overuns. The modern approach is to licence the basic system, to minimise regulatory complexities in constructing the plants at any site worldwide.
During the politically-induced oil shortages of the 1970s the French took the decision to not be literally put over a barrel of oil, in the future. They then went nuclear in a big way, with the result that today they are the world leaders in nuclear electricity and generate about 80% of their electricity from nuclear.
Dr. Yves Guenon of the French nuclear company Areva, believes that the French experience has proven that running a country on nuclear power is not the big fear factor that the anti-nuclear lobby love to project.
Minister Peters points out that this year is the 25th anniversary of Koeberg nuclear power station, and that Eskom should have projected this fact to the public to indicate that South Africa has considerable experience in operating a nuclear power plant, to world standards.
South Africa must go nuclear in a big way, this is not an option, so it is a case of how rapidly can we do it. We can do it fast, it just needs some courage and fortitude plus some far-sighted wisdom.
