Eskom has for the first time made a public admission that the cost for the upgrades of the Koeberg Nuclear Power Station will surge above the initially budgeted R20 billion.
The struggling power utility, however, has not managed to come up with a new figure for the estimated budget to extend the lifespan of the Koeberg power station by a further 20 years.
Eskom’s acting chief nuclear officer, Keith Featherstone, yesterday said that the original cost estimate of R20bn was done in the 2010 parameter, and if reassessed in today’s values it would be significantly different.
Featherstone was briefing the joint meeting of the portfolio committees on mineral resources and energy, and public enterprises on the Koeberg’s steam generator replacement project.
“This change does not alter the scope of the overall life extension plan, but the unexpected compensation events and contract price adjustment (CPA) increases will have an impact on the cost of the specific steam generator replacement allocation, which is still in the process of being finalised,” he said.
“That ultimately is a fair and simple summary of where it is. We’ve had delays and there were contributions on both sides of the fence.
“We have not made any allegations to any Eskom employee. We asked for an independent to be completed. And once that investigation is completed, we will assess what is being done and take appropriate action stemming from that report.”
Eskom has over the years been adamant that the overall budget of R20bn made in 2010 for Koeberg’s life-extension project remained unchanged in spite of changes to the initial scope of work over the years.
Koeberg Alert Alliance’s energy activist Peter Becker yesterday questioned Eskom’s wisdom for insisting on an outdated cost structure for Koeberg’s upgrades.
Becker said inflation and exchange rate, as well as rising salaries over a 12-year period had increased the estimated costs for the overall project.
“Eskom are being very cagey about what the total cost of the refurbishment is estimated to be, and until recently were insisting it was still R20bn,” Becker said.
“Based on US inflation since 2010 and the current exchange rate, we estimate it to be R67.4bn. To give some context, that is enough to purchase about 4GW of solar PV.”
Meanwhile, Eskom also admitted that the delays in its steam generator replacement project had pushed it to ramp up its rotational power cuts to Stage 6 load shedding.
Koeberg’s Unit 2 was taken offline in January for a five-month maintenance to replace a steam generator in the containment building, removing 920MW from the national grid.
However, the project faced serious delays and Unit 2 was only returned to service in August due to poor project management, inadequate contract management and a lack of financial discipline.
Featherstone said “emergent technical issues” were to blame for the delay to the return of the unit to service.
“The delay in Outage 225 led to an increase in load shedding and was a key component of the Stage 6 load shedding because the delay in the return to service of the unit coincided with peak demand during the winter season,” he said.
Eskom has now pushed the commencement of the replacement of a second set of three steam generators on the 920MW reactor Unit 1 from October to December.
Another steam generator replacement on Unit 2 is now scheduled starting October 2023 and lasting an estimated five months, closer to the 31 July, 2024 deadline for the expiry of the current Long-Term Operation Licence.
These upgrades are required by the National Nuclear Regulator (NNR) to extend the operating life of the nuclear facility by a further 20 years.
National Union of Mineworkers (NUM) Western Cape full-time shop steward Phumzile Mvovo said they were praying - for the sake of 1 600 workers and contractors at Koeberg - that the Unit 1 project truly starts in December.
“If it is not done now this Unit 1 coming outage, Unit 1 will not be allowed to go back to power without a new steam generator because that would be the close of life expectancy,” Mvovo said.
“This is the last time that we must do it, and October 2023 will be the last time for Unit 2. So these are the last resorts for both units. We have left it until the last possible time whereas we were supposed to have done this by 2018.”
BUSINESS REPORT