South Africa: More Funds, Muscle for Power Regulators

Johannesburg — THE national treasury has this week allocated more than R1,4bn towards strengthening the oversight roles of both the nuclear and electricity regulatory bodies amid plans by government to build more nuclear and coal-fired power stations.

The new budget is in addition to the R128m that was allocated to the two bodies last year.

Industry analysts have welcomed the extra funds, saying this was important to give teeth to regulators. Often, companies have more financial muscle that their respective industry watchdogs, making it difficult for such authorities to tackle them head on.

The national treasury said in its 2007 estimates of national expenditure document released this week that the budget of the National Nuclear Regulator would increase to R24m a year in the next two years from the allocation of R14,7m.

The money would enable the nuclear regulator to monitor nuclear activities and develop safety standards for the protection of people, property and the environment against nuclear damage.

The nuclear regulator exercises safety regulatory control over the entire life cycle of nuclear installations and vessels propelled by or containing radioactive material.

About R3m had be allocated to implement the radioactive waste management policy, which the minerals and energy department said would be finalised this year.

The treasury said the Electricity Distribution Industry Holdings, a state-owned company that has been tasked with the creation of six regional electricity distributors, had been allocated R1,2bn.

The money was raised through tariff surcharges that had been built into Eskom's electricity prices by the National Energy Regulator of SA (Nersa). Launched in November last year to regulate the electricity, gas and petroleum industries, Nersa will not only have deeper pockets but more powers as well.

The new Electricity Regulation Act of 2006 allows Nersa to impose a 10% fine on the offender's revenue, or R2m a day, whichever is higher.

The national treasury said last year that it had also allocated R21m to nuclear technology agency the South African Nuclear Energy Corporation which is conducting research into the development of a high-technology mini nuclear plant, the pebble bed modular reactor.

An additional R1,2bn has been allocated to the pebble bed modular reactor project for the construction of the fuel plants. Such a reactor is expected to be operational by 2011.

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