S.C. lawmakers say a federal investigation into a move by SCANA and Santee Cooper to abandon two partially built nuclear reactors in Fairfield County could help get to the bottom of what went wrong.
Some said news of the probe Thursday validated the efforts of S.C. Senate and House committees investigating the project’s failure, which will cost S.C. power customers billions of dollars.
Others complained SCANA executives had been evasive in legislative hearings into the $9 billion debacle. “The absolute arrogance of the leadership of that company and their response to their own conduct is outrageous,” state Rep. James Smith, D-Richland, said Thursday.
One lawmaker, a former prosecutor, predicted federal investigators will look closely at what the shareholder-owned SCANA told its investors about the outlook for the two reactors it was building.
Another welcomed the federal investigation, saying the failed project needs to be looked into by someone other than legislators, who passed a 2007 law that allowed South Carolinians to be charged for the two reactors while they were under construction.
Speaker Jay Lucas, R-Darlington, said testimony during two House hearings on the project indicates “the collapse of the V.C. Summer nuclear project was much more careless and fraudulent than initially believed.”
“Every available option should be executed to help determine the root of this $9 billion problem,” Lucas said, welcoming the federal investigation into the nuclear-reactor construction project.
‘It was very disturbing’
It is unclear what aspect of the project’s failure federal investigators may target.
Both Cayce-based SCANA and the state-owned Santee Cooper utility, the minority owner, have been subpoenaed for documents related to the nuclear project. Both said they will cooperate.
State Rep. Micah Caskey, R-Lexington, a former prosecutor, says he expects federal investigators to examine whether SCANA misled investors, including its stockholders, about the outlook for the nuclear project in federal securities filings.
“If you’re engaged in a project that may fail, and that project is of material magnitude, you’ve got to tell people that this thing might not work out and that you might be on the hook for those costs,” Caskey said.
Speaker Pro Tempore Tommy Pope, R-York, said his “greatest concern was that (SCANA) knew what was going on and did nothing to rectify the situation.”
With its customers bearing the burden of the project’s cost overruns, SCANA executives could “continue to take their bonuses, continue to raise rates, because they were at not risk,” he added.
After two contentious hearings with SCANA executives over the past week, some legislators said they are grateful that federal investigators now are involved, adding they can shine more light on what led to the project’s failure.
State Rep. Peter McCoy, the Charleston Republican who chairs the House committee investigating the V.C. Summer debacle, said SCANA executives repeatedly avoided legislators’ questions and refused to accept blame. “It was very disturbing.
State Rep. Russell Ott, D-Calhoun, said SCANA’s cooperation with legislators has been “very minimal,” citing its refusal to release a critical February 2016 report by the Bechtel Corp. That report — subsequently released by Santee Cooper at the insistence of Gov. Henry McMaster — diagnosed critical problems with the Fairfield County project.
Federal investigators would not be similarly hamstrung, he said, adding they could demand cooperation.
“They will have the ability to force the turnover of any related documents, maybe that we weren’t able to because of our limited (subpoena) ability,” Ott said. “If you’re not receiving any cooperation from the agency, it’s hard to know what to subpoena.”
‘SCANA’s got their hands full’
State Sen. Mike Fanning, D-Fairfield, whose district includes the V.C. Summer nuclear plant, said questions about the nuclear project need review by an agency other than lawmakers, who passed a 2007 law that allowed SCANA to charge its customers for the reactors while they were under construction.
“It is apparent that SCANA had information that the project might be impossible to finish even before they made the decision not to finish it,’’ he said.
However, state Sen. Shane Massey, co-chair of the Senate committee examining the project’s failure, said news of the federal investigation validates the hours both State House committees have poured into questioning the utilities.
“It re-emphasizes the seriousness of the situation,” the Edgefield Republican said. “You’ve got more entities looking into what happened, and I think it is probably reflective of the concern and frustration that you’re seeing from people statewide.
“Most of us feel like there’s a lot more out there that we don’t know yet. There’s got to be more questions asked and more looking under the hood. This has been going on for 10 years. We’re learning a lot of things in the last couple months that nobody knew before hand. There’s definitely more out there. It’s just hard to know what it is and where you’ve got to go to find it.”
Senate President Pro Tempore Hugh Leatherman, R-Florence, said he has “no way of knowing what that (the federal grand jury investigation) means. I’m not sure what road that jury is going down.”
However, he added, “SCANA’s got their hands full.”