Eskom: We made mistakes at Medupi and Kusile

Eskom: We made mistakes at Medupi and Kusile

2014-09-17 07:27

Cape Town - Eskom has acknowledged that mistakes have been made in the construction of both the Kusile and Medupi coal-fired power stations and the state-owned enterprise is taking action to penalise contractors for failing to do their work properly, acting CEO Collin Matjila said on Tuesday.

While he came under a determined onslaught from Democratic Alliance, Inkatha Freedom Party and Economic Freedom Fighters MPs on the national assembly energy portfolio committee earlier on Tuesday, Matjila would not be drawn on the mounting costs of significant delays at the Mpumalanga and Limpopo power stations.

DA energy spokesperson Lance Greyling charged that the delays – caused by labour strikes at Medupi and Kusile  and construction problems blamed by Matjila on the contracting parties – had cost about R120bn and a similar amount for Kusile; Matjila did not put a rand figure to the costs.

But he admitted to the committee - chaired by ANC MP Fikile Majola - that Eskom had made “mistakes”.  To ensure that there were no “unscheduled slips” in future, Eskom has conducted “elaborate agreements” forged with workers employed by the contractors and sub-contractors on projects.

These were forged after “painstaking negotiations”, he acknowledged.

Asked by Inkatha MP Jan Esterhuizen why the power monopoly had not been protected from recent strike action, Matjila pointed out that Eskom workers were indeed not permitted to strike. The striking workers were “employees of the contractors” and were not “essential service workers… they are allowed to strike”.

Eskom was now confident, however, that there was a “much better relationship between Eskom, the contractors and the workers”. Matjila believed that there was now support for the build programme which would ensure the delivery of “all these projects”.

Greyling said that Medupi was at least 14 months behind the latest schedule, while the IFP MP said he did not believe Medupi would be on stream this year either.

Matjila said action was being taken against companies that had not met their schedules, but these actions and counter-claims had also led to further project delays.

At Medupi there had been serious delays because of boiler welding glitches.

“We have learnt some painful lessons… we have put in measures (to ensure) that we avoid any repetition of those lessons,” said Matjila. Eskom had put monitoring systems in place which included determining “what is happening at the workshops”.

The National Union of Metalworkers of South Africa went on a national strike in July which affected Kusile and Medupi. Murray & Roberts, which is involved in the boiler installation at both plants, reported that about 1 400 workers at Kusile were on strike at the time and about 800 stayed away from work at Medupi.
The strike in the metal sector lasted a month, with most workers getting a 10% pay hike.

The energy committee was told that they were likely to face power instability for the next five years. Matjila said the power monopoly’s turnaround plans would only be completed by 2019.

The entity had “a comprehensive plan to accelerate the performance of our... plants by attacking the unplanned outages that are the result of... deferred maintenance as well as poor performance by the contractors”, Matjila said.

 - Fin24

  • Made-In SA - 2014-09-17 07:38

    What is this mistakes he is talking about? It was faulty welding to the boilers for both Meduphi and Khusile. The same boilers the ANC owned Hitachi Power Africa had a R38 Billion contract for. The welding then had to be done over and overseas welders had to be flown in to correct this.Resulting in the contractor being paid more no doubt.Google it if you don't believe me.

      Edrich Hunt - 2014-09-17 08:46

      I see a light at the end of the tunnel.......oh shyte i hope it's not a train!!!

      Ian Flack - 2014-09-17 10:28

      Edrich, that's a candle, which is going to be blown out any second now!

      Stefan Van Der Spuy - 2014-09-17 11:45

      Eskom is one big mistake.

      Stefan Van Der Spuy - 2014-09-17 11:46

      Eskom has turned a necessity (electricity) into a luxury which few can afford.

      Nin Ja Kitty - 2014-09-17 12:02

      And another episode of SCAPEGOATIA. The story line is always the same - its always someone else's fault. Looking forward to the first episode of the Game of Stones - how protesters win the fight against Poor service delivery by throwing stones at innocents.

  • John Williamsii - 2014-09-17 07:47

    Now you have to ask: you look at South Korea, Samsung, LG, Hyundai, Hynix, etc. what's wrong with that? What's wrong with JUST achieving that? South Korea is currently the world's 10th largest economy, it was as poor as Mozambique 60 years ago! What are we doing? Why are we wasting our time and energy and money in socialism? Why is the ANC pursuing socialism? What are we doing? Privatize the entire government and move to full free market capitalism immediately, like South Korea, Singapore, Taiwan. We will be lucky, just to achieve what they have achieved in the past 50 years!

  • Marie Hamilton - 2014-09-17 07:54

    Yeh right! Imagine this place in another 20 years. Please mr president give me some of my tax money back so that I can get the hell out of africa!!!

      Andre Jacobs - 2014-09-17 09:06

      We love this country and we stay on probably the best continent on earth but what is the use if you try to make things better (and there was a chance to do that and many tried) and the sick attitude destroys all attempts. We can't carry on like this trying to get better governance going through LAW COURTS the whole time. They do something -it ends up in court They don't do something they are supposed to do---it ends up in court You do something to get them to do so something --it ends up in court They protect secrets-it ends up in court they do business or trade--it ends up in court to try and get them to court (zum) --you must go to court. We are stuck on court cases and no wonder the country is regressing- the anc is spending all their time and our tax money to deal with court cases where they messed up.

      Marie Hamilton - 2014-09-17 10:04

      I agree Andre. I'm sure most don't care what colour leads SA but flip after 20 years the ANC is so not it!!!! It does not matter what the majority sees happening in front of them, sadly they follow like sheep!

      Andre Jacobs - 2014-09-17 10:29

      Just reading that N24 article on"how do psychopaths get the way they are, and couldn't help to connect it to the anc and the African ATTITUDE. IT COULD BE SCIENTIFIC-no guilt for misbehaving and they all have that 'disconnection'. " While telling white lies or hurting others are part of growing up most children feel guilty about misbehaving – except for those with aggressive and antisocial personality disorders. In people with these disorders research indicates there may be a faulty connection between the deep, emotional brain (the limbic system) and the thinking part of the brain (the frontal lobe). This means the rational part of the brain can't exercise its normal control over strong emotions such as fear and aggression. It may well be the reason why things that make normal people afraid or sad have no effect on psychopaths." Most of them (if not all) are Psychopaths and they can't help it.

      Marie Hamilton - 2014-09-17 11:05

      Makes such sense, thanks

      Andre Jacobs - 2014-09-17 16:48

      It will be interesting if researchers could try and find a link between religion and that connection and if religion can 'build' a connection so that kids will develop that guilt feeling for misbehaving. Why I ask--many teachers from Zimbabwe are teaching here in SA and they were brought up going to Catholic schools and they were taught with the British system and they are very good and dedicated and proud and they do actually have that good attitude to do things correctly and they seem to be 'better' persons. Could it be that religion also played a role? A good role? That will be a blow to atheists.

  • John Williamsii - 2014-09-17 08:09

    How about we come to the conclusion that it is the government itself that isn't working out - let BUSINESS PROFESSIONALS run businesses for PROFIT and PERFORMANCE! Lower business taxes to 15% and get completely out of the way of business. Leave the entire economy to entrepreneurs.

  • Bernd Kankowski - 2014-09-17 08:11

    It is because all labour laws have been skewed in favour of the labourers. They use these big projects and hold the government and contractors to ransom. These critical projects should have all their labour issues sorted prior to commencement of the project. Strikes during these critical projects should be seen as sabotaging the economy of SA and should not be tolerated.

  • Andrew Mackie - 2014-09-17 08:14

    After the horse has bolted and having cost extra Rmillions action taken !! Is it not a case of bad planning and supervision by ESKOM and now only once the situation has become urgent are remedies put in place and hopefully some meaningful action being taken. In the end we the consumers will be paying for all this by way of higher tariffs.

  • David Broadfoot - 2014-09-17 08:31

    You should ' nt have hired Unqualified ppl ( FRIENDS ) In the 1st place .

  • Gary Smith - 2014-09-17 08:33

    Does Chancellor House which is the ANC pension fund scheme not hold 25% of Eskom shares? Gee I wonder why they keep up with these Eskom deals? Is the possibility not that somehow the Chancellor House chaps should not be looked at?

      Allan Keyzer - 2014-09-17 09:04

      The government is in business with itself. Fraud 101 the seller cannot be the buyer!

  • Julian Pretorius - 2014-09-17 09:00

    And Brain Dames knew all of this....why do you think he left all as sudden as he did?

  • Lynn Hugo - 2014-09-17 09:17

    And the taxpayer is paying the price.

  • Yolanda Gerber - 2014-09-17 09:20

    This fiasco will go down in history as the worst Project Management in history from Eskom. Eskom also vetted and approved their suppliers / contractors - also gross incompetence, yet again. Stop blaming the rest of the world, blame yourselves. Incompetent management from start to finish. All the world of red tape and flawed internal systems cannot rectify this problem.

  • Linda Nzima Mazibuko - 2014-09-17 09:22

    Just reminded me of De_Sulphur project that was supposed to cost ZAR200 millions but ended up pay 300% more. Kept doing until the board asked the CEO to get involved!

  • Harry De Wet - 2014-09-17 13:00

    The mighty untouchable Eskom is lying again - they have empowered and protected the workers and their unions so that they could delay the construction, because the incompetent Eskom was much too disorganized and late themselves. Eskom is still trying to delay everything, by targeting Mitsubishi Hitachi Power Systems Africa with unreasonable rejection of about every fabrication/construction document submitted to them - Eskom also takes ages to review documents and apparently do not have enough resources. On the other hand, Eskom hardly checks any documents from their other main contractor, i.e. Alstom. Why do we as the consumers have to pay for the incompetencies and mistakes from Eskom? Why can't we have other private electricity suppliers in competition with Eskom?

  • Frank Jordaan - 2014-09-17 14:06

    A R120 billion mistake!!!!! Just like the SABC and SAA another ANC 'success story' which we as taxpayers must subsidize. When is this rot and incompetence going to end.A private sector company with such an atrocious performance would have been exctinct by now.We as citizens just cannot sit back and any longer and whatch whilst sheer incompetence and corruption destroy our society!!!!!!

  • Janet Pretorius - 2014-09-17 14:36

    More of more tenders for buddies more like it.......

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