Could Westinghouse help prove SC power customers shouldn’t pay for VC Summer?

As some S.C. lawmakers work to stop SCE&G from charging its customers any more for the failed V.C. Summer nuclear expansion, they are hoping for help from an unlikely ally: the lead contractor blamed for botching the $9 billion project.

Pennsylvania-based Westinghouse is sitting on a trove of construction documents that lawmakers hope could show that SCE&G knew for years that the Fairfield County project was doomed but failed to find solutions, instead raising rates on its customers to bankroll the effort.

The now-bankrupt nuclear contractor might be willing to cough up those records, according to the chairman of the S.C. House committee investigating South Carolina’s nuclear debacle.

State Rep. Peter McCoy, R-Charleston, told The State that he and a group of House members met with Westinghouse lawyers on March 6 to negotiate the release of some or all of those documents. Former or current Westinghouse employees also could testify at a future House hearing, McCoy said. A Westinghouse spokeswoman confirmed the negotiations but would not comment further.

“I’m trying to prove that there was deception,” McCoy said, “and that they moved forward with milking the ratepayers of this state.”

The state Senate also is on board. Its Judiciary Committee on Tuesday OK’d a proposal to empower the Office of Regulatory Staff, the state agency that polices utilities, to sue for the same testimony and documents, if necessary.

“If I were ORS, I would want to talk to Westinghouse,” said Senate Majority Leader Shane Massey, R-Edgefield.

Scott Elliott, a Columbia attorney who represents large industries in energy cases, said Westinghouse has been the “missing link” in disputes about the nine rate hikes that SCE&G levied to help pay for the Summer project. Elliott said SCE&G often deflected questions about the project and its progress to Westinghouse, which couldn’t easily be compelled to testify before the S.C. Public Service Commission, which sets power rates.

“Westinghouse has always been the question mark, and (SCE&G) used that to their advantage,” Elliott said.

McCoy’s meeting with Westinghouse followed a Feb. 27 letter from the House demanding the contractor testify on its role in the failed Summer project, a decadelong effort that SCANA subsidiary SCE&G and its junior partner, the state-owned Santee Cooper utility, quit last July.

The power companies have blamed the project’s failure on Westinghouse, citing its bankruptcy last March.

But state lawmakers have hammered SCE&G and Santee Cooper for what they say was inadequate management of the nuclear expansion, which already has cost SCE&G customers some $2 billion in the form of higher power bills.

They hope Westinghouse can help them make the case that some of SCE&G’s nine rate hikes to bankroll the failing project were fraudulent. That argument could factor into the S.C. Public Service Commission’s ruling – expected later this year – on whether SCE&G’s customers or its shareholders should pay for the useless reactors.

“We want to know what they knew and what SCANA potentially knew and relayed to them during that time, pre-Bechtel, that kind of information,” McCoy said, referring to the once-secret February 2016 report by Bechtel Corp. that diagnosed critical problems with the nuclear project. “Did Westinghouse have actual knowledge from SCANA that this project was not going to be completed? My angle with this is to figure out what SCANA has disclosed to them.”

The House's letter to Westinghouse last month requesting documents and testimony was "more or less a shot in the dark," McCoy said. "They're in Pennsylvania and going through bankruptcy proceedings now, so I didn’t know whether they would even respond.”

But the company has been open-minded about turning over its records, McCoy said. The House, in turn, has postponed the March 21 hearing it hoped Westinghouse officials would appear at, in part to give the company time to track down former employees who worked on the Summer project.

This story was originally published March 20, 2018 at 2:13 PM with the headline "Could Westinghouse help prove SC power customers shouldn’t pay for VC Summer?."