SCE&G nuclear project may stay afloat past Monday deadline

SCE&G and Santee Cooper are expected to continue their review of the troubled V.C. Summer nuclear expansion project beyond Monday, the deadline they set months ago after the main contractor filed for bankruptcy.

After Westinghouse Electric filed for bankruptcy in March, questions were raised about how the $14 billion project could be completed and whether the effort would be abandoned. SCE&G and state-owned Santee Cooper signed a deal with Westinghouse for the work to continue while they assessed the project. That deal ends Monday.

But as of late Friday, there were indications the two utilities would seek to extend the deadline. The issue is important to customers of both companies, who combined have already paid nearly $2 billion for the project. About 18 percent of an SCE&G customer’s bill goes to the Jenkinsville project.

“Nothing is official, but my expectation is they are working on an extension; otherwise, I think we’d have some movement occurring,’’ said Dukes Scott, director of the S.C. Office of Regulatory Staff, an agency charged with looking out for the public interest.

Neither power company would say whether it would try to extend the deadline, but SCE&G indicated Thursday that it is not near a decision on whether to abandon the project.

If the deadline to complete the assessment is extended, construction work is expected to continue. The construction project employs about 5,000 people.

The troubles for Westinghouse center on difficulties in building the two nuclear reactors in South Carolina and two more in Georgia. The South Carolina project, beset with delays and cost overruns, is $2 billion to $3 billion over budget, with some analysts expecting the costs to go higher.

On Thursday, the state Public Service Commission agreed to hold a hearing in August on the project’s future. The commission has approved nine SCE&G rate increases to finance the project.

The Santee Cooper board meets Monday to discuss and vote on a matter concerning the V.C. Summer plant. The agenda, which has little detail, shows that the board will vote on an “authorization’’ for the V.C. summer project.

SCE&G’s top executives have said they’d like to finish the work because the company needs the extra energy capacity to meet customer demands in the future.

But critics question the need for the amount of energy expected from two more nuclear reactors – and they argue that the plant has been a financial boondoggle that should be discontinued. Environmental groups, which often oppose nuclear construction because of concerns about radioactive waste, called last week for state regulators to refund SCE&G ratepayers for cost overruns.

Santee Cooper, which unlike SCE&G is not regulated by a state oversight board, has hit customers with five rate increases that included money for the reactor project. The company has collected about $540 million from customers, out of some $4 billion Santee Cooper spent on the project, spokeswoman Mollie Gore said.

When Westinghouse filed for bankruptcy, it threw the already controversial project into further question.

Now, SCE&G is negotiating with Toshiba, Westinghouse’s parent corporation, for money to help pay for the reactor construction work. SCE&G says Toshiba previously had agreed to pay about $1.7 billion toward the work, although that has been in question because of its own shaky financial status.

Earlier this month, Toshiba, itself in financial trouble because of Westinghouse’s bankruptcy, agreed to pay $3.6 billion for construction of a similar nuclear project Westinghouse was managing in Georgia.

But the S.C. Office of Regulatory Staff says that Georgia deal appears contingent on a deal also being struck between Toshiba and SCE&G in South Carolina.

“To my knowledge, they don’t have any kind of signed agreement yet or anything like that, but they are negotiating,” Scott said. “I don’t know if in the next few days we’re going to hear something about that or not.”

Sierra Club lawyer Bob Guild and Tom Clements, an organizer with Friends of the Earth, said they expect the deadline to be extended in what they called a sad story of mismanagement. Clements, citing financial analysts’ projections, said the cost could be nearly $23 billion, more than double the original price tag.

“Our belief has always been that there’s just not enough money to go around,’’ Guild said. “I expect on June 26 what we’re going to hear is another delay to allow SCE&G management and their stockholders to make the decision.’’

This story was originally published June 24, 2017 at 4:44 PM with the headline "SCE&G nuclear project may stay afloat past Monday deadline."