Thursday, February 9, 2023

Tender for Eskom’s coal-fired boilers back in spotlight | Business

Eskom hopes to improve the performance of its coal-fired power stations.

Eskom hopes to enhance the efficiency of its coal-fired energy stations.

  • Eskom is interesting an October judgment that overturned the upkeep contract for boilers at coal energy stations.
  • The affected firm is Babcock Engineering, one in every of three unique tools producers (OEMs) of boilers in SA.
  • However, Eskom’s restoration plan has OEMs taking part in a vital function.
  • For extra monetary information, go to the News24 Business front page.

Eskom, which has promised to herald the perfect unique tools producers (OEMs) to enhance upkeep, is on the identical time steaming forward with litigation in opposition to one in every of them, which, if profitable, will bar the corporate from sustaining the boilers it constructed for a number of years.

Contracting OEMs is a key a part of the Eskom board’s technology restoration plan. It can be a method endorsed by the National Energy Crisis Committee. There are solely three OEMs of Eskom’s older coal-fired boilers in SA: Babcock Ntuthuko Engineering, Steinmuller, and Actom. 

Hitachi is the OEM for the boilers at Medupi and Kusile. 

Babcock is the designated OEM of the boilers at Matla, Lethabo, half of the models at Hendrina, and Grootvlei 1 to 4 and 6. It can be the engineering firm with the perfect information of Kendall, because it has been answerable for upkeep for the reason that energy station started. 

While the upkeep contracts for the boilers had been beforehand shared by Babcock, Steinmuller and Actom, in 2020, a brand new tender to the worth of R16 billion was marketed. A 12 months later, it was lastly awarded to Steinmuller and Actom, whereas Babcock was disqualified for failing to submit a welding certificates that Eskom already had in its possession. 

A courtroom overturned the tender award final October, discovering that Babcock had been irrationally excluded as Eskom already had the certificates in its possession from earlier contracts. The courtroom gave Eskom eight months to run a brand new tender, leaving the established order in place for the interim in order that the Eskom upkeep programme wouldn’t be affected.

But that was not the top of the story. Eskom resolved to attraction the judgment, which might be heard within the North Gauteng High Court in Pretoria on Friday. If the attraction goes in Eskom’s favour, Babcock is excluded from sustaining Eskom boilers till 2025. 

READ | Eskom to appeal ‘insensible’ judgment against R16bn boiler maintenance tender

The Eskom board’s restoration plan proposes intense upkeep of the six worst-performing vegetation, whereas defending these which are the perfect performing. The six embrace Kendal, Matla, Majuba, Duvha, Tutuka and Kusile. 

Last week, briefing the general public for the primary time on the brand new board’s technology restoration plan, chairperson Mpho Makwana stated: 

“These stations must be prioritised by developing the best talent, sufficient capital and the best OEM support in critical plants.”

Babcock can be the OEM for the best-performing of the older vegetation, Lethabo. It is unclear whether or not the board sanctioned Eskom’s attraction in opposition to Babcock, as Eskom didn’t reply to questions by the shut of enterprise on Wednesday. 

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