Who will build six new nuclear power plants envisioned in South Africa is unknown. But a possible entry into the good graces of decision makers is what was at stake, when Westinghouse Electric Co. lost a bid to replace six steam generators at the Koeberg power station near Cape Town, South Africa, the Pittsburgh-based PowerSource has reported.
Eskom, the South African utility, gave the $370 million steam generator replacement project to Westinghouse rival Areva partly on fears that Westinghouse would miss the 2018 deadline for when the generators needed to be swapped out, PowerSource said.
South Africa has said it is on track to build six nuclear power plants by 2030. With a focus on that goal, advisers from AF-Consult Switzerland Ltd., hired by Eskom, said that it anticipated the steam generator project would be an entry point into “the largest major nuclear spend,” in the country's nuclear ambitions. The steam generator project, pointedly, would give the company that won the bid an inside track on developing "relationships with suppliers,” and possibly others, such as government officials and labor groups, which may be important when the next round of projects are announced.
Westinghouse is pursuing the matter in court. With the steam generator project seen as pivotal to billions of dollars of future work, Westinghouse has been scrutinizing court-ordered documents in order to find a way to revisit the bidding process.
Eskom has told the court that Westinghouse is stirring up rumors of prejudice among company officials, hoping to find an accusation that will stick – in other words, rumor mongering.
Documents show that AF-Consult Switzerland recommended Eskom award their bid with consideration given to “strategic issues,” which included meeting deadlines. The firm also suggested Eskom consider the value of previous work done at Koeberg. The insider track advantage that Eskom considered for the steam generator project, based on previous work, could be said to reflect the insider track advantage the steam generator project would lend to the big prizes: Contracts to build one or more of the new plants envisioned for the country.
The advantage there might have given Areva only a slight advantage, as Westinghouse designed the Koeberg reactors, but Areva built them.
Putting the bid together for the steam generator work has already cost Westinghouse $5 million. The company also says that engineering subcontractors who helped put the losing bid together would require compensation in the form of future work.