Nuclear powerNuclear power project abandoned as energy landscape changes, costs escalate
On Monday, after working nine years to expand a nuclear power plant in South Carolina, Santee Cooper and SCE&G announced they were pulling the plug on the $14 billion reactor project in Fairfield County. The companies cited rising costs, falling demand for energy, construction delays, and the bankruptcy of lead contractor Westinghouse. SCE&G customers have paid $1.4 billion through higher monthly utility bills – customers saw their rates increase nine different times over the last four years – and consumer groups in the state say they would demand that the money be refunded to consumers.
On Monday, after working nine years to expand a nuclear power plant in South Carolina, Santee Cooper and SCE&G announced they were pulling the plug on the $14 billion reactor project in Fairfield County. The companies cited rising costs, falling demand for energy, construction delays, and the bankruptcy of lead contractor Westinghouse.
St. Louis Post-Dispatch reports that Westinghouse filed for bankruptcy earlier this year, leading SCE&G to review the Fairfield County nuclear project. On Monday, the company said that the review found that finishing the two nuclear reactors “would be prohibitively expensive.”
SCE&G customers have paid $1.4 billion through higher monthly utility bills – customers saw their rates increase nine different times over the last four years – and consumer groups in the state say they would demand that the money be refunded to consumers.
About 18 percent of an SCE&G customer’s bill goes for the nuclear project.
Thousands of jobs in South Carolina will be lost as a result of the project’s demise.
To date, SCE&G and Santee Cooper have spent about $9 billion on a project, the original cost estimate of which was $12 billion.
New reviews have concluded that the project would cost at least twice that — $24 billion in all – and the prospect of investing $14 billion more proved too much for the two companies.
“Customers have had a tough time with this the last several years,’’ Jimmy Addison, chief financial officer of SCANA, SCE&G’s parent corporation, said during a call with investors. “Our intention is to stay away from any kind of increases on the back of this and on customers’ bills.’’
Lonnie Carter, chief executive of Santee Cooper, said nearly $1 billion pledged to Santee Cooper by the Toshiba Corp., Westinghouse’s parent, could be used to offset future rate increases that would have been assessed to pay for the project. The question is whether Toshiba, itself in financial trouble and facing bankruptcy, would be in a position to make good on the pledge, Carter said. Toshiba pledged $1.1 billion last week to SCE&G that the investor owned utility also said it would use to keep customer rates down.
“It wouldn’t be a direct rebate; they would actually just see it in their power bills through lower costs,’’ Carter said.
