SEC seeks documents from SCANA after nuclear fiasco

V.C. Summer nuclear plant
V.C. Summer nuclear plant

The U.S. Securities and Exchange Commission has subpoenaed SCANA for documents as part of an investigation into the utility’s failed nuclear construction project.

SCANA disclosed the SEC investigation Tuesday, adding it would “fully cooperate.”

SCANA and partner Santee Cooper spent $9 billion over a decade building two new reactors in Fairfield County, then walked away from the project July 31, saying it had become too expensive. That incensed lawmakers, upset ratepayers and sparked an array of criminal and legislative investigations, as well as a raft of lawsuits.

The project’s shutdown left more than 5,000 people out of work and customers upset that they had been charged more than $2 billion by SCANA’s SCE&G subsidiary and Santee Cooper for the work. The project was canceled after chief contractor Westinghouse filed for bankruptcy.

The SEC investigation into SCANA follows revelations last month that a federal grand jury was looking into the Cayce-headquartered utility over the nuclear project. The utility and state-owned Santee Cooper acknowledged in September that they had received subpoenas from the U.S. Attorney’s Office seeking documents.

“I don’t think this is all that surprising given the other investigations that are going on,’’ said financial analyst Paul Patterson, who is with Glenrock Associates. “At this point, people should have been thinking something like this would probably be happening.’’

SCANA’s stock price dropped on the latest news Tuesday but then recovered, trading for about $49 a share. That is down from a high of nearly $75 last year, before the nuclear construction troubles surfaced.

Ryan White, spokesman for the SEC in Washington, declined comment. His agency, typically, looks into allegations of securities law violations. If a violation is found, the SEC can bring a civil case in federal court. It also works with law enforcement agencies to bring criminal cases in some circumstances.

Violations that can spark SEC investigations include misrepresenting or withholding information that is significant to investors in a company’s stock or debt, and sales of stock by corporate executives with “insider” knowledge, according to the agency’s website.

In SCANA’s case, a key question is whether the utility should have disclosed to investors a highly critical consulting report that found substantial problems with the nuclear project at the V.C. Summer site.

A final version of the Bechtel report, commissioned at Santee Cooper’s urging, was given to the utilities in February 2016. But the report was not released to the public until this fall, a move SCANA actively campaigned against.

State Rep. Kirkman Finlay, R-Richland, said he doesn’t know if SCANA broke any securities laws, but he doesn’t think the company was upfront with the public about what was going on at the V.C. Summer project.

“All of this is going to be related to what have they disclosed to investors and regulators, when they knew they had issues,’’ said Finlay, who is on a legislative committee looking into why the nuclear project failed.

Santee Cooper said it has little first-hand knowledge about the SEC probe.

“Santee Cooper has not received a subpoena from the SEC, and we have no information that Santee Cooper has been named as a subject of an SEC investigation,’’ agency spokeswoman Mollie Gore said.