Wed, Apr 18, 2001 page18

• Taipower denies receiving claim

  COMPENSATION Taipower said a newspaper report claiming GE is demanding US$50 million for the delay in building the Fourth Nuclear Power Plant is false

  • STAFF WRITER
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  Taiwan Power Co (Taipower, 台電) yesterday denied a local media report that US-based General Electric (GE) has demanded US$50 million in damages for a 110-day delay in the Fourth Nuclear Power Plant (核四).

  Huang Shou-ching (黃壽清), director of the Nuclear and Fossil Fuel Department at Taipower, made the denial in response to a newspaper report that GE has asked Taiwan's state-owned power company to compensate it US$50 million for its financial loss due to the Chen Shui-bian (陳水扁) government's abrupt decision to halt construction on the new nuclear power plant.

  Huang debunked the report, saying that GE has not yet produced data concerning its financial loss caused by the power plant construction hiatus nor has it presented a compensation claim.

  Huang said he has no idea about the possible source of the newspaper report. "It's a surprise to me," he noted.

  According to Huang, the earlier GE submits its financial loss report, the greater the benefit for all.

  "After we receive GE's compensation claim, we'll conduct a comprehensive assessment with the assistance of relevant consulting firms and accounting experts as well as send staff members to GE for discussion," Huang explained, adding that if the two sides are far divided over the compensation amount, Taipower will not rule out the possibility of seeking commercial arbitration.

  GE is the largest contractor for Taipower's fourth nuclear power plant, and its foreign contractors for the project also include Japan's Mitsubishi Co and Hitachi Co.

  The paper also went on to say Taipower will send officials to the US in May in order to examine accounting records in the claim, since Taipower little experience in negotiating a large scale case, and room for negotiation seems very limited.

  Meanwhile, since Ta Tung Construction (大棟) -- one of the major contractors on the plant -- insisted on pulling out of the nuclear power plant project due to delays, Taipower will be forced to reopen the bidding process.

  Ta Tung was charged with building a special receiving dock in Kungliao (貢寮) township for the two nuclear reactors. The delay will set back the actual operational date of the nuclear power plant by more than one year.

  Bowing to pressure from the opposition-controlled Legislative Yuan, the government announced its decision to resume construction on the controversial plant on Feb. 14.

  "And Taipower informed the three foreign contractors of the decision the following day," Huang said, adding that Taipower also asked the three firms to present their financial loss reports for its reference.

  However, Huang said, none of them have so far furnished Taipower with relevant data or made any compensation claims.

  Huang said GE once told Taipower that its financial loss estimates require data from its 100-plus subcontractors. "I think that GE's delay in producing a financial loss report may be related to the large number of its subcontractors."
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