Eskom wins ConCourt nuclear battle

Dec 21 2016 12:46

Cape Town - Eskom on Wednesday won a Constitutional Court case to dismiss the application by Westinghouse to review the award of the tender for the replacement of the six steam generators at the Koeberg Power Station.

French company Areva is currently building the replacement reactors in France. This follows a Supreme Court of Appeal judgment that had set aside the Areva contract, declared it “unlawful”, and ordered that it be remitted back to Eskom for reconsideration.

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FULL STATEMENT: ConCourt summary of Eskom judgment

DOWNLOAD: Full judgment

Judge Raymond Zondo noted the minority judgment of Deputy Chief Justice Dikgang Moseneke with acting Judge Lebotsang Bosielo, which stated that Eskom was “truly meticulous and proper in its assessment of the bids”.

"Here there was no suggestion in evidence or argument that the BTC was actuated by malice, irrationality, corruption or other improper motive."

“The evidence suggests that the board tender committee (BTC) process was a hallmark of careful consideration of all relevant factors,” Zondo noted.

“Westinghouse’s claim that certain vital strategic tender requirements were irregularly considered mid-stream is not supported by a careful evaluation of the tender process. In my respectful view of the Supreme Court of Appeal erred by finding that the strategic consideration fell outside the bid evaluation criteria,” the minority judgment said.

Westinghouse must pay Areva's costs in the ConCourt and in the Supreme Court of Appeal including the costs of two counsel, Zondo said in his judgment.

"Today’s judgment confirms that Eskom follows a robust governance process in the awarding of the contracts," Eskom said.

Acting Eskom CEO Matshela Koko tweeted following the victory that Eskom will not fail South Africans with nuclear. This comes 12 hours after Eskom released the request for information ahead of the nuclear procurement programme.

According to energy analyst Chris Yelland, the contract award was the biggest that has ever been disputed in a court of law in South Africa.

"Eskom and Areva say that the steam generators are approaching their end-of-life, and that it is critical that they be replaced during the normal reactor refueling and maintenance outages in 2018 (known as the X23 outages).

"The Koeberg power station, built in South Africa in the mid-1980s by French nuclear contractor Framatome – the predecessor of Areva – uses nuclear reactor and steam generator designs licensed from Westinghouse. Indeed, Westinghouse was a founding shareholder of Framatome in 1958, before it disposed of its shareholder interest in Framatome in later years.

"The Koeberg nuclear power station has an output of about 1800 MW, and its two 900 MW reactors, each with three associated steam generators, have been in commercial service for some 30 years. The design life of the power station is 40 years, before significant upgrades, including the replacement of the steam generators, are required to extend its life."

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concourt  |  eskom  |  nuclear energy



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