National Treasury will not allow its R 350 billion guarantee facility to Eskom to be used for the building of nuclear power stations.
But it has confirmed that the facility, with a March 2017 expiry date, will be extended to cover the much-delayed new coal power stations Eskom is already building.
The government provided a total of R350 billion of guarantees to Eskom in 2009 and 2011 to close a funding gap that put in question Eskom’s ability to complete its new Medupi, Kusile and Ingula power stations.
Treasury said the guarantee facility was originally provided to Eskom to support the financing of the new build programme, in other words, to enable the completion of the power stations.
At the time when the facility was provided, it was anticipated that the power stations would be completed in 2017, Treasury said, and hence the guarantee availability period was set to expire in line with the expected completion date.
Eskom has reiterated it wants to start soon on a nuclear-build programme that will cost anything up to R 1 trillion, and the funding of which would require extensive government guarantees.
But Finance Minister Pravin Gordhan has made it clear he would not approve anything SA could not afford.
Thyspunt has been earmarked as the preferred site for the construction of a nuclear power station, which will have a catastrophic impact on the ailing infrastructure in Kouga.
A recent report has indicated that Thyspunt is not safe to build a nuclear power station due to seismic risk as well as rising sea levels.
Local residents are also concerned about the expected influx of people into the area which will impact on crime and increase unemployment in Kouga.