Yesterday the Department of Energy (DoE) tabled new drafts of the Integrated Energy Plan (IEP) and the Integrated Resource Plan (IRP) and the Organisation Undoing Tax Abuse (OUTA) is not happy with the content.

The crux of OUTA’s argument is that the assumptions and scenarios used by the DoE still attempt to justify the need for nuclear power.

“In our opinion, the entire process reeks of reverse engineering to try and accommodate the introduction of nuclear energy,” OUTA’s portfolio director for energy, Ted Blom said in a media statement.

One of the arguments OUTA makes is that the DoE did not select a zero-base model which would have taken nuclear power out of the equation altogether. The organisation alleges that the DoE assumed determinations made up until December 2015 were not subject to be changed and as such determined when nuclear power should be built rather than if nuclear power should be built.

The hits just keep on coming

OUTA goes on to point out other inconsistencies in the drafts presented by the department including that the DoE appears to have used the older IRP-2010 policy – which referenced nuclear – as opposed to the IRP-2013 which referenced no nuclear power.

The GDP growth assumption is also problematic OUTA says. The 2.4% growth by 2018 is reportedly double the estimate that was put forward by the Treasury which ultimately means that the demand projected in the draft is drastically over inflated.

The organisation also questions the validity of having head of Eskom generation, Matshela Koko advise Minister Tina Joemat-Pettersson on the future energy mix of South Africa.

The other problems OUTA says point toward a reverse engineered outcome include:

  • The 2016 IRP assumptions includes a constrained renewable energy build rate of 1GW per annum. This is completely arbitrary and against the spirit of discovering the lowest cost price path for South Africa and provides a false scenario to justify the nuclear decision.
  • In essence, a series of policy adjustments appear to have been made before the public consultation process has started, pre-disposing the outcome towards nuclear.
  • A further error assumed the same discount rate used for projects with completely different risk profiles.
  • The extension of the IRP planning horizon from twenty to thirty five years has also create a scenario to slip a long term nuclear possibility into the mix, and then to fast track this into the immediate future.

OUTA spokesperson, Wayne Duvenage has said that the organisation is investigating whether it would be possible to challenge the IRP and IEP base case methodology, assumptions and rationality judicially. The spokesperson says that the departments decisions could have “extremely expensive and adverse decisions for South Africa”.

We want to know what you think, is OUTA justified in calling the DoE out for a draft that is problematic, but still subject to public comment before it is set in stone? Or do you think that OUTA is jumping the line before the starting gun has fired.

Personally, given the data presented yesterday, investment in nuclear seems silly especially given the weight that renewable energy in the form of PV and wind was given. Of course OUTA makes good points about the fact that perhaps nuclear should have been excluded from plans.

Let us know your thoughts in the comments below or sling us a tweet over on Twitter.

[Image –  CC BY SA Till Westermayer]