South Africa's energy policy is at a crossroads with the government this week declaring a waning interest in coal, doing a possible flip on nuclear and showing a keen focus on natural gas, including shale gas, and hydropower.

The long-awaited updated Integrated Resources Plan (IRP) was released for comment this week and shows a change in thinking about energy policy, based on projections of a far lower energy demand over the next 20 years.

Coming in line with the National Development Plan, the IRP now suggests that the cost of nuclear — estimated to be more than R1-trillion — is too high and may even be abandoned in favour of using alternatives such as regional hydropower and shale gas to fulfill the country's energy requirements.

The document suggests the nuclear decision can possibly be delayed.

"The revised demand projections suggest that no new nuclear base-load capacity is required until after 2025 (and for lower demand not until at earliest 2035) and that there are alternative options [such as regional hydro from Mozambique and Zambia] that can fulfil the requirement and allow further exploration of the shale gas potential before prematurely committing to a technology that may be redundant if the electricity demand expectations do not materialise."

Despite escalating costs and delays at the coal-fired power stations, Medupi and Kusile, Coal 3 was approved by the Cabinet this year and remains in the mix of the new IRP — however, it will be significantly smaller with a generation capacity of less than one-third of Medupi and Kusile, between 1 000 megawatts and 1500MW.

Critics unconvinced

But the updated plan has done little to convince critics that the department of energy finally has a clear direction on South Africa's energy mix.

In some quarters, the revised document has caused even greater confusion, given that the government recently indicated the procurement process for nuclear construction is close to being finalised.

In April, the director general of the department of energy, Nelisiwe Magubane, said the nuclear plans were not negotiable and in line with the NDP.

Then it was reported in the Russian media that a deal had been struck to build South Africa's planned nuclear power plants, although Energy Minister Ben Martins denied these claims. But energy experts say that, without nuclear, South Africa will never meet the emission reduction targets it is committed to, and it is not yet known whether shale gas will be viable (See "Jury still out on viability of Karoo shale gas").

Given the uncertainty surrounding this, the IRP has come up with a number of scenarios.

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