Utilities to stop building billion-dollar nuke reactors
COLUMBIA, S.C. — The owners of two nuclear reactors under construction in South Carolina decided Monday to cease operations at the project, which has been beset by delays and cost overruns.
While the decision will save customers billions in additional costs, the two utilities may get little to nothing refunded of the billions they’ve already paid for the now-abandoned project.
The reactors were set to be among the first built in the U.S. in decades.
Santee Cooper’s board said the decision to end construction will save customers an estimated $7 billion. The utility had already spent about $5 billion for its 45 percent share of the project, and completing it would have cost an additional $8 billion, plus $3.4 billion in interest. It also likely wouldn’t have been finished until 2024. The first reactor initially was supposed to be online earlier this year.
South Carolina Electric & Gas, which owns 55 percent, announced its plans shortly after Santee Cooper’s unanimous vote. That utility’s executives will brief state regulators Tuesday.
“It became obvious to us” to end construction, said Santee Cooper CEO Lonnie Carter.
Under the approved Santee Cooper resolution, all work will end within six months. How quickly within that timeframe workers at the site will lose their jobs is uncertain.
Doubt: The project has been shrouded in doubt since earlier this year, when primary contractor Westinghouse filed for bankruptcy protection.
The utilities announced last week that Westinghouse’s parent company, Toshiba Corp., agreed to jointly pay them $2.2 billion regardless of whether the reactors are ever completed.
The reactors were planned for the V.C. Summer Nuclear Station north of Columbia. Construction began with state approval in 2009, and the project was so far about one-third completed.
Environmental groups have called on state regulators to order SCE&G to abandon the projects. They also want customers to be refunded at least some of the billions they’d paid upfront through rates that have increased yearly since 2009.
A 2007 state law allows electric utilities to collect money from customers to finance a project before it generates power. Construction now accounts for 18 percent of the electric bills of SCE&G’s residential customers.
Santee Cooper has increased rates five times to pay for the escalating costs. But the Public Service Commission has no authority over the state-owned utility.
The commission has set a hearing on the environmental group’s request for October.
Whether the commission can order the utility to refund customers and how much are matters of debate. That could require proof the utility gave regulators faulty information.
Last month, Toshiba agreed to pay $3.7 billion toward two nuclear reactors in Georgia that also were being built by Westinghouse.