Cape Town - Three senior staff at Eskom’s Koeberg Nuclear Power Station have been suspended with full pay for poor project management, inadequate contract management and a lack of financial discipline, as an independent investigation continues into problems that led to delays in completing the steam generator replacement project.
Eskom on Tuesday briefed the joint portfolio committee on issues concerning the nuclear power plant and what led to the suspensions.
The National Union of Mineworkers (NUM) also raised several concerns about Eskom’s decision to prolong the required maintenance of the steam generator replacement, adding that it suspected dodgy dealings between Eskom and the contractor.
In January this year, Unit 2 of the Koeberg Nuclear Power Station, which provides 920MW, was taken offline for regular refuelling and maintenance outage as well as the replacement of the unit’s three steam generators.
Two weeks ago Eskom confirmed it had finalised its application to the National Energy Regulator of South Africa (Nersa) to renew the nuclear licence for Koeberg for another 20 years, post its original generation life, which ends July 31, 2024.
The steam generator replacement project is a critical enabler to the life extension of the power station.
In his presentation on Tuesday, Chief nuclear officer Keith Featherstone said: “The scope of refuelling Outage 225 on Koeberg Unit 2 was originally intended to include the replacement of the steam generators on Unit 2.
However, Eskom had to remove the project from Outage 225 due to several serious deficiencies in the front-end loading of the project.”
He said both Eskom and the contractor had contributed to the deficiencies and there are several associated disputes currently subject to adjudication.
An example cited by the contractor regarding Eskom’s role in contributing towards the project not commencing as scheduled included that the facilities, which were required to house the old steam generators once removed, were not ready for use.
“Eskom management has identified poor project management, inadequate contract management and a lack of financial discipline as being contributory factors towards the project not commencing as scheduled.”
The ailing power utility’s Generation Board initiated an independent investigation into this matter which is expected to be completed by the end of this month.
“While the outcome of the investigation will assist management to determine remedial and consequence management actions to be taken, thus far, three senior employees have been placed on precautionary suspension with full pay,” Featherstone said.
Removing the steam generator replacement work scope from the outage required the outage to be completely replanned.
“Unfortunately, during the start-up phase, after completion of all the maintenance and project work, emergent technical issues resulted in a delay to the return of the unit to service, which happened on August 7, 2022. The delay in Outage 225 led to an increase in load shedding and was a key component of the Stage 6 load shedding because the delay in the return to service of the unit coincided with peak demand during the winter season.
“As a result, the steam generator replacements are now scheduled for Outage 126 on Unit 1 (starting December 2022) and Outage 226 on Unit 2 (starting October 2023).”
While this change apparently would not alter the scope of the overall life extension plan, Eskom said the unexpected compensation events and contract price adjustment (CPA) increases would have an impact on the cost of the specific steam generator replacement allocation, which is still in the process of being finalised.
The original cost estimate of R20 billion was done in 2010.
NUM Western Cape believed the suspension of their members was unfair and discriminatory, saying that the project influence was much higher than just the staff in question, at executive level “to pay additional large sums beyond the contract value.
The bulk of the delay was as a result of the (contractor’s) work not (being) completed as planned. It is understood by our members there was no deficiency that could have caused any reason to postpone the project”.
Eskom CEO Andre de Ruyter however criticised the union for using the committee briefing as a platform to address labour-related issues.
He said this should have been done through its structures at plant level, including the Koeberg Business Unit.
“The insinuations made by the NUM representative that there is some collusion between the executives and the contractor in question... we are not aware of any of this, but if they have any evidence, they are duty bound to raise this through our whistle-blower facility.
But purely making embarrassing allegations simply is not enough to absolve a senior manager of accountability for under performance.”
Committee on Mineral Resources and Energy chairperson Sahlulele Luzipo said the issue was a matter of national interest and could not only be reduced to a labour-related issue.
The committee agreed that it would conduct a site visit to Koeberg to start its own investigation.
The Koeberg Alert Alliance meanwhile criticised the continued investment into the plant while it was still grappling with ongoing issues.
“Unit 2 was taken offline on 18 January 2022 for what Eskom said would be a five-month outage to refuel and replace the 3 steam generators. That turned into an eight-month outage. Eskom did still not manage to replace the steam generators.
Despite what Eskom told Parliament, five months is not ‘similar’ to eight months,” said the group’s spokesperson, Peter Becker.
He said they estimated that the R20bn cost for work has escalated to R67bn.
Meanwhile Public Enterprises Minister, Pravin Gordhan informed Eskom’s board on Tuesday that a review had been finalised and that the board would soon be reconstituted and restructured.