South Africans are punch-drunk from weekly disclosures of new incidents of state capture and theft of public resources. The amounts are so great and varied that it is difficult to calculate how much has been stolen.
Public enterprises minister Pravin Gordhan believes it could exceed R100bn.
Public disillusionment with government agencies is equalled by disenchantment with other societal institutions that are supposed to prevent such criminality.
Yet auditors, lawyers, consultants and others appear to have protected the criminals rather than expose their misdeeds.
Incidents of corporate complicity together with malfeasance unrelated to state capture have added to the growing despondency.
While impatience with the slow progress in bringing the perpetrators to justice is understandable, it is important to remember that misdeeds have actually been exposed. We need to give thanks for the heroes who revealed incidents of gross theft and misrule, sometimes at great personal cost. These include ministers Nhlanhla Nene and Mcebisi Jonas, Vytjie Mentor and countless whistle-blowers and journalists.
— SA OWES A LARGE DEBT OF GRATITUDE TO NENE. HIS REFUSAL TO APPROVE THE NUCLEAR DEAL PROBABLY LED TO HIS FIRING AS FINANCE MINISTER
SA owes a particularly large debt of gratitude to Nene. We know that his refusal to approve the nuclear deal probably led to his infamous firing as finance minister. His action saved SA from bankruptcy. The proposed simultaneous build of six giant nuclear power stations would have crippled the economy.
The true cost would have far exceeded the amount quoted by its supporters. The opportunities for corruption and multiple cost overruns would have been immense. Who would deny an avaricious contractor asking to spend an unbudgeted R100m, if this was argued on grounds of a nuclear power station’s safety?
Not only would an overpriced deal have been unaffordable, but the electricity it would have produced is not actually needed. The slow growth of the economy since 2010, when initial government projections of future electricity demand were made, has undercut the claimed necessity for anything like the scale of the proposed nuclear deal.
This means the size of the economy in 2020 will be about 25% smaller than that forecast only eight years ago.
The reduction in electricity demand is even greater than the weakness in GDP. Electricity-intensive users such as mining and manufacturing have grown much slower than total GDP. Eskom’s fourfold increase in the electricity price since 2008 has substantially lowered demand, because all users have looked for ways to reduce their consumption.
Some have even gone off grid. The result is the predicted increase in electricity usage on which nuclear was based has not materialised. Electricity demand today is unchanged from 2008.
The past decade has also seen dramatic declines in the costs of alternative methods of generation such as wind and solar. These have the added advantage that they can be built rapidly and in small increments.
In a country where future electricity demand is uncertain, this is a huge advantage over nuclear or coal, which have long construction times.
It avoids the possible addition of large amounts of new capacity that then prove to be unneeded.
— THE PROPOSED SIMULTANEOUS BUILD OF SIX GIANT NUCLEAR POWER STATIONS WOULD HAVE CRIPPLED THE ECONOMY
The 2010 Integrated Resource Plan (IRP) was supposed to be updated every two years. Subsequent iterations in 2013 and 2016 failed to produce the justification for immediate large-scale nuclear that politicians demanded, so their projections were ignored.
Support for nuclear continued to be based upon the discredited 2010 projections. An updated IRP is due for release this week. The legitimacy of its recommendations will depend on the realism of its projections of future demand and its consideration of the costs of alternative modes of generation. If nuclear continues to feature, it is likely to be only in the distant future and on a much smaller scale than previously envisaged.
We must thank Nene for saving us from all this wasteful spending. It would have bankrupted us, preventing future spending in areas where it is really needed, such as housing, water and sanitation.
• Keeton is with the economics department at Rhodes University.
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