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More nuclear power to come on stream by 2023

Shale gas and the search for oil and gas offshore could be ‘a game changer’ – Zuma.

South African President Jacob Zuma said his priority is to solve the energy crisis in the country that’s curbing output at mines and factories and stifling economic growth, including adding more nuclear power by 2023.

“We will pursue gas, petroleum, nuclear, hydropower and other sources as part of the energy mix,” Zuma, 72, said in his annual state-of-the-nation speech in Parliament in Cape Town on Thursday. “The country is currently experiencing serious energy constraints which are an impediment to economic growth and is a major inconvenience to everyone in the country.”

Zuma’s speech follows nine consecutive days of rolling blackouts implemented as demand for power outstripped supply. State utility Eskom Holdings SOC Ltd., which provides 95 percent of the nation’s electricity, has warned of almost-daily blackouts until the end of April.

The power crisis has soured investor appetite for South Africa’s currency and debt. The rand reached a 13-year low against the dollar on Wednesday and foreigners dumped 6.9 billion rand ($590 million) of the nation’s bonds since Feb. 3, the first day of blackouts. The outages have curbed mining production and forced businesses to shut doors at peak times, crimping growth in Africa’s most-industrialized economy.

The government is seeking to build a 9,600 megawatt nuclear-energy program, with the first power from the source in eight years, Zuma said. South Africa has signed agreements and carried out vendor workshops with the U.S., South Korea, Russia, France and China, he said.

Game changer

Shale gas in the Karoo region, and the search for oil and gas offshore could be “a game changer” for the country, Zuma said.

South Africa’s central bank cut its 2015 growth forecast to 2.2 percent on Jan. 29 from 2.5 percent two months earlier. The government is targeting a growth rate of 5 percent by 2019.

Zuma, a former intelligence operative, took office for a second five-year term in May after the African National Congress won a fifth straight election with 62.2 percent of the vote. His administration’s economic policy is to implement the 20-year National Development Plan that seeks to cut the jobless rate to 14 percent by 2020 from 24 percent.

Zuma’s speech was disrupted by the opposition Economic Freedom Fighters who sought to pressure him to repay state funds spent on his private home. Parliament sent in security personnel to eject the party’s lawmakers from the chamber. The Democratic Alliance, the biggest opposition group, walked out in protest at the presence of armed security in the legislature.

A report released in March by Thuli Madonsela, the nation’s graft ombudsman, alleged Zuma unduly benefited from the 215 million-rand renovation of his residence in the eastern KwaZulu- Natal province. Zuma denied ordering the alterations, which included a swimming pool, chicken run and cattle enclosure.

©2015 Bloomberg News


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