ANSI joins were not introduced until Oracle Database 9iR1 (9.0.1). They are not supported in 8.1.7.
Try re-writing the query without an ANSI style join.
Something like this may work:
SELECT DECODE(seqnum, 1, t.ID1,cnt,'0') PI_VALUE1,
DECODE(seqnum, 1, t.STARTTIME,cnt,t.ENDTIME) timestamp,
'090.'
|| t2.APP
|| '.BATCH' tagname
FROM
(SELECT t.*,
row_number() over(partition BY t.ID1, t.PLANT_UNIT order by t.STARTTIME) AS seqnum,
COUNT(*) over(partition BY t.ID1, t.PLANT_UNIT) cnt
FROM tb_steps t
) t, tb_equipments t2
WHERE t2.plant_unit = t.plant_unit
AND (t.seqnum = 1
or t.seqnum = t.cnt)
AND (T.STARTTIME > '15-jul-2013'
AND t.ENDTIME < '15-aug-2013') ;
Totally untested....
Hope that helps.