SCE&G and VC Summer: By the numbers
The decision this week by SCE&G and Santee Cooper to abandon construction of two partially built, multi-billion-dollar reactors in Fairfield County continues to raise questions throughout South Carolina and across the country.
SCE&G and junior-partner Santee Cooper quit the project at the V.C. Summer nuclear station because of higher-than-expected costs and less-than-expected demand for energy, as well as troubles with Westinghouse, its chief contractor. Westinghouse filed for bankruptcy in March, which effectively torpedoed the project.
Here are some of the questions being asked about the decision.
Q. Could the V.C. Summer expansion project be revived?
A: It’s unlikely. SCE&G could not find a partner to replace Santee Cooper in the project, after the state-owned utility decided to pull out, officials said. SCE&G executives said they tried unsuccessfully to get federal help, going as far up as the White House with funding requests. The company also had no luck with other utilities.
Some politicians in Fairfield County favor the state providing financial support to revive the project, but that would be difficult given the expense.
The state’s budget is about $8 billion, and the cost of finishing the project could equal or exceed that. SCE&G and Santee Cooper have spent about $9 billion on the project. Estimates show the V.C. Summer expansion could have ultimately cost more than $20 billion.
Q. How high are S.C. residents' power rates compared to residents of other states?
A. South Carolina families pay the highest power bills in the South, and the third highest in the country, trailing only Connecticut and Hawaii, according to the most recent data available.
In 2015, S.C. households paid an average of $144 a month for electricity. That was up from $111.20 a month in 2007, the year that a law — the Base Load Review Act — passed the S.C. Legislature allowing utilities to start charging their customers part of the cost of building new power-generation facilities. (Previously, utilities only could recover those costs once a new power station was operating.)
In 2007, South Carolina had the 12th highest monthly power bills of any state, according to the U.S. Energy Information Administration.
The Palmetto State’s $38.84 increase in monthly power bills since 2007 was the third highest jump in the country, trailing only Kansas and West Virginia.
Plans now are under way to charge SCE&G customers for the shutdown of the nuclear project, but some project opponents have said they will seek to get people their money back. SCE&G and Santee Cooper said they won’t offer refunds to customers who have paid higher power bills to help finance the project.
Q. How much will the shutdown cost the state in unemployment benefits?
A: The shutdown, which cost about 5,000 construction workers their jobs, will likely put a dent in the state’s Unemployment Insurance Trust Fund, which is funded by employer taxes.
Officials with the S.C. Department of Employment and Workforce had no estimate Wednesday of the number of former plant workers who might file for unemployment. Plus, workers draw unemployment benefits from their home states, and the vast majority of the V.C. Summer construction workers are said to be from out of state.
However, officials believe about 500 of the workers live in Fairfield County.
Unemployment benefits are based on each worker’s salary. In South Carolina, the average construction worker earns about $15 an hour. At that hourly rate, the 500 Fairfield County workers could cost the trust $3 million if they receive full unemployment benefits.
The trust fund balance was $678 million as of July 28.
“While this layoff is large and has the potential for thousands of people to file for unemployment, the unemployment insurance trust fund is not in immediate jeopardy,” DEW spokesman Robert Bouyea said.
Q. What impact has canceling completion of the reactors had on SCANA's stock price?
A. It's been positive. The price of shares in SCANA, the parent of SCE&G, have increased by more than $3 a share since Monday, closing at $65.33 Thursday. At one point Tuesday, SCANA stock was selling for $67.94 a share, up more than $6 from its opening price Monday, just hours before state-owned Santee Cooper and SCE&G said they would give up on completing the multi-billion-dollar reactors.
Q. Will lawsuits result from the decision?
A. It’s likely. Attorneys representing upset ratepayers already are asking questions of state agencies and others who have tracked the V.C. Summer expansion project.
Dukes Scott, director of the S.C. Office of Regulatory Staff, said he’s received a number of phone calls this week from attorneys seeking information from his agency. Some of those attorneys have checked on a legal filing in which SCE&G is seeking to formally abandon the plant and recover $5 billion it already has paid for the facility. The plan is to recover some of the money over 60 years.
Customers of SCE&G have been hit with nine rate hikes for the nuclear project totaling $1.4 billion. Santee Cooper has raised rates five times for the project, generating about $500 million.
Charleston environmental lawyer Blan Holman said he was approached by an attorney before the decision was made to abandon the project. Holman has tracked the V.C. Summer project for the Southern Environmental Law Center.
Q. Why is Georgia still planning to build a twin reactor project when South Carolina has abandoned its own project?
A. Westinghouse, a subsidiary of Toshiba, was the main contractor on both the V.C. Summer project and a similar one in Georgia. Georgia Power has not decided whether to move forward with its two-reactor effort, but most observers believe the company will.
Georgia Power is much larger than SCE&G. The company, a division of the Southern Co., has 2.5 million customers compared to SCE&G’s 713,000. Southern is one of the country’s largest energy companies. Santee Cooper, SCE&G’s partner in the Jenkinsville project, has 176,000 direct customers, although Santee Cooper also provides power to several of the state’s electric cooperatives.
Georgia Power, SCANA and Santee Cooper all reached settlement agreements with Toshiba. But Georgia Power, because of the way its contract for the project was written, will receive about $1.4 billion more than the S.C. utilities will get combined. Toshiba pledged $3.68 billion to compensate Georgia utilities for the Westinghouse bankruptcy, while SCE&G and Santee Cooper are supposed to get $2.2 billion.
Construction of the Georgia plants near Augusta is 44 percent complete, compared to about 34 percent at South Carolina’s V.C. Summer site.