High Court Ruling “Deals Blow” to South Africa-Russia Nuclear Plan

South Africa Energy Minister, Mmamoloko Kubayi (Reuters)

South Africa – The South African High court in the Western Cape all but put brakes on the government’s nuclear energy plans involving Russia’s state-owned nuclear company Rosatom. High court Judge Lee Bozalek ruled on Wednesday 26 April 2017 that South Africa’s agreement with Russia’s Rosatom to build 9 600MW capacity nuclear reactors was unlawful.

In 2014, South Africa and Russia signed an Intergovernmental Agreement (IGA) for cooperation between South Africa’s state-owned power utility Eskom, and nuclear group Rosatom.

Two South African nongovernmental organisations, Earthlife Africa and the Southern African Faith Communities’ Environment Institute brought the case to the high court challenging the various steps taken by the South African government in the nuclear power procurement process. The challenge by the two organisations focussed on two separate determinations made by the Minister of Energy in 2013 and 2016, and the constitutionality of the tabling by the Minister before Parliament of three IGAs – Russian, US and South Korean - in 2015.

Through their lawyer Adrian Pole, who is an environmental lawyer, the applicants argued that both the minister’s determinations, and the National Energy Regulator of South Africa’s (Nersa) agreement with the minister, were unlawful, unreasonable and procedurally unfair since there was no public participation or consultation on either the minister’s decision or that of Nersa.

Legally, the energy minister has to issue determinations to authorise electricity infrastructure, based on what its draft energy policy – known as the Integrated Resource Plan (IRP) – says the country requires.

Other critics of the South Africa-Russia agreement lament its being skewed in Russia’s favour. But the South African government and other pro-nuclear lobbyists insist the agreement was not a final contract and that an open tender process would still be conducted.

However, in his judgement, Judge Bozalek said, “Seen as a whole, the Russian IGA stands well outside the category of a broad nuclear cooperation agreement, and at the very least, sets the parties well on their way to a binding, exclusive agreement in relation to the procurement of new reactor plants from that particular country.”

Bozalek’s ruling effectively set aside the two ministerial determinations, set by the minister of energy, that South Africa should procure 9 600MW of nuclear power and that Eskom should be the procurer. The judge also set aside the South Africa-Russia Intergovernmental Agreement citing the fact that the agreement was never nonbinding as the South African government portrayed it. Also set aside was Eskom’s request for information, issued in December 2016.

As such, the judge found that both the 2013 and 2016 determinations were unlawful and unconstitutional, and were accordingly reviewed and set aside. As a result, the judgment also set aside any Request for Proposals or Requests for Information issued by Eskom as a result of the determinations.

However, speaking to South Africa’s Parliament’s energy committee on Tuesday 2 May 2017, the new energy minister, Mmamoloko Kubayi, suggested that the South African government may appeal the high court’s ruling.

"Do we have to appeal the judgment? We are looking at those options," said the energy minister.

Should the government chose to appeal then new determinations will have to be issued by the energy minister and Nersa will have to subject such determinations to a public participation process.

But any new determinations will have to be informed by a new IRP which is still on the drawing board and is already raising concerns as it is alleged to place artificial limits on renewable energy.