Construction at South Carolina nuclear power plants suspended

Georgia’s utility regulating agency voted unanimously Tuesday to approve $674 million in spending on the Plant Vogtle nuclear expansion Georgia Power Co. reported incurring during the last half of 2019.

COLUMBIA, S.C. — Santee Cooper, South Carolina’s leading power company, along with its partner, Scana Energy, announced the unanimous decision to suspend construction on two new nuclear power plants currently being built at the existing V.C. Summer nuclear plant in the state.

The V.C. Summer project, as well as a twin project by Southern Company’s Georgia Power at Plant Vogtle, have faced billions of dollars in cost overruns, schedule delays and technical problems.

The troubles for both nuclear reactor projects were exacerbated recently by the financial meltdown of Japan’s Toshiba and subsequent declaration of bankruptcy by Toshiba subsidiary, Westinghouse. Westinghouse is the vendor of the AP1000 experimental reactors under construction at both the V.C. Summer site and Plant Vogtle.

According to the Santee Cooper website, the company’s board of directors approved on Monday the suspension of construction of Units 2 and 3 at V.C. Summer Nuclear Station in Jenkinsville, S.C.

The decision is reportedly anticipated to save Santee Cooper customers nearly $7 billion in additional costs to complete the project, including projected interest during construction.

The decision to suspend construction is based in large part on a comprehensive analysis of detailed schedule and cost data, from both project contractor Westinghouse Electric Co. and subcontractor Fluor Corp., first revealed after Westinghouse filed for bankruptcy in March, according to Santee Cooper officials.

Santee Cooper has spent approximately $4.7 billion in construction and interest to date for its 45 percent share of the new nuclear power project. A recent analysis showed the project would not be finished until 2024, four years after the most recent completion date provided by Westinghouse, and would end up costing Santee Cooper customers a total of $11.4 billion.

“Santee Cooper and majority partner South Carolina Electric & Gas Co. gave Westinghouse full notice to proceed in April 2012. The contract provided that Westinghouse would provide substantially complete units in 2016 (Unit 2) and 2019 (Unit 3),” a statement by Santee Cooper said. “Santee Cooper’s board approved a $5.1 billion budget, representing its 45 percent share of the joint project and additional transmission needed for the Santee Cooper electric system. In October 2015, the board approved an amended Westinghouse contract that included an option to fix our share of the costs at $6.2 billion, and the board approved fixing the price at $6.2 billion in June 2016.”

Anticipating the rejection of the contract by Westinghouse in bankruptcy proceedings, analysis showed the final cost for Santee Cooper to complete the project would be $8 billion for construction and approximately $3.4 billion for interest. The schedule delays increased the projected interest costs 143 percent over the original plan.

“Generation diversity remains an important strategy for Santee Cooper, but the costs of these units are simply too much for our customers to bear,” said Leighton Lord, chairman of the Santee Cooper board of directors.

“After Westinghouse’s bankruptcy and anticipated rejection of the fixed-price contract, the best case scenario shows this project would be several years late and 75 percent more than originally planned,” said Lonnie Carter, Santee Cooper’s president and CEO. “We simply cannot ask our customers to pay for a project that has become uneconomical. And even though suspending construction is the best option for them, we are disappointed that our contractor has failed to meet its obligations and put Santee Cooper and our customers in this situation.”

According to officials at the Southern Alliance for Clean Energy, after more than eight years, both projects lack an exact cost to complete and revised completion schedule with construction only about one-third complete.

SACE officials also pointed out that anti-consumer laws in South Carolina and Georgia have unfairly forced rate-payers to bear the financial brunt of the mismanaged projects with more rate hikes proposed.

“We applaud Santee Cooper and SCE&G for making the right decision to protect their customers,” Southern Alliance for Clean Energy executive director Stephen A. Smith said. “This project has been a multibillion-dollar disaster. We also call on Georgia Power and their utility partners to protect their customers from the similarly risky mismanaged project in Georgia at Southern Company’s Plant Vogtle.”

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I am primarily the public safety reporter, but also cover a variety of other news events and special features. I am a graduate of the University of Georgia with a degree in Philosophy and have been with the Herald since April of 2016.

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