Nuclear firms at loggerheads over Eskom’s ‘unlawful’ Koeberg tender award as the electricity giant contests court ruling
“This is both new and untrue.” Citing an Eskom study, Westinghouse argued that X23 was not “an immutable deadline”. The company also argued that, despite the work that had begun, “Areva has considerably delayed the implementation of the tender and will not … meet X23”. Westinghouse believed the replacement steam generators could be safely installed during future shutdowns at Koeberg. At the last minute, Westinghouse lost the Koeberg tender to Areva. On each previous occasion, Eskom’s technical and executive teams had recommended Westinghouse, only to be overruled at either board or ministerial level. Court documents show that both companies had neck-and-neck technical offerings, with Westinghouse coming in cheaper and offering more in terms of localisation. Eskom argued that Areva had squeezed out Westinghouse at a so-called penalty shoot-out a month before the tender winner was announced. It was here that the additional “strategic considerations”, which Eskom says gave Areva the edge, surfaced. Despite the shoot-out, Eskom’s technical experts ultimately handed a recommendation to the parastatal’s board tender committee to award the tender to Westinghouse, but in a secret ballot the board reversed the decision.
Eskom then explained the decision in a letter to Public Enterprises Minister Lynne Brown, outlining five “strategic criteria” that the committee had considered when it made its decision.
Eskom also later admitted in the South Gauteng High Court that a three-month “float” in Areva’s project plan to replace the steam generator was indicated as a deciding factor.
Koko conceded in the high court that the strategic considerations were not part of the tender evaluation criteria.
However, the appeal court found that each criterion was introduced after the tender criteria had already been set and were, therefore, inserted unlawfully into the process.
Eskom is optimistic that the Constitutional Court will view the considerations in a different light.
Eskom insiders have told City Press that if the tender was to be reissued, it could take from six months up to a year before it could be awarded again.
Westinghouse hopes that the Constitutional Court will go one step further than the supreme court did, and award it the contract outright.