(task) S.C. utilities halt work on new nuclear reactors, dimming the prospects for a nuclear energy revival - The Washington Post

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nuclear, economics, bankruptcy, Epoch B

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> https://www.washingtonpost.com/business/economy/sc-utilities-halt-work-on-new-nuclear-reactors-dimming-the-prospects-for-a-nuclear-energy-revival/2017/07/31/5c8ec4a0-7614-11e7-8f39-eeb7d3a2d304_story.html?utm_term=.4d943602e82a <https://www.washingtonpost.com/business/economy/sc-utilities-halt-work-on-new-nuclear-reactors-dimming-the-prospects-for-a-nuclear-energy-revival/2017/07/31/5c8ec4a0-7614-11e7-8f39-eeb7d3a2d304_story.html?utm_term=.4d943602e82a>
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> S.C. utilities halt work on new nuclear reactors, dimming the prospects for a nuclear energy revival
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> The long quest to revive America’s nuclear power industry suffered a crippling setback on Monday when two South Carolina utilities halted construction on a pair of reactors that were once expected to showcase a modern design for a new age of nuclear power.
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> The project has been plagued by billions of dollars of cost overuns, stagnant demand for electricity, competition from cheap natural gas plants, and the bankruptcy of Westinghouse <https://www.washingtonpost.com/business/economy/westinghouse-files-for-bankruptcy-in-a-blow-to-nuclear-power-industry/2017/03/29/4a64b6f2-1338-11e7-833c-503e1f6394c9_story.html?utm_term=.5a5b7a4501e3>Electric, the lead contractor and the designer of the AP1000 reactor that was supposed to be the foundation of a smarter, cheaper generation of nuclear power plants.
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> Instead, the South Carolina reactors, along with two others under construction in Georgia, have demonstrated that the main obstacle to new nuclear power projects is an economic one. The plants would be more viable if the federal government were to impose a tax on carbon as part of climate change policy, but that seems unlikely.
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> Santee Cooper, the junior partner in the reactor project with a 45 percent share, said shelving the project would save nearly $7 billion in additional costs to complete it, which would have pushed the price tag to $11.4 billion on what was only supposed to cost $5.1 billion to begin with.
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> SCANA, the lead partner with a 55 percent stake, said completing the plants would be “prohibitively expensive.” The reactors were being built at the V.C. Summer Nuclear Station in Jenkinsville, S.C. The two utilities said they would ask the Public Service Commission of South Carolina to approve a plan to abandon the project.
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> There are 99 nuclear reactors in the United States, but only one new nuclear power reactor has been completed since the 1980s. And none had begun construction since an accident at Pennsylvania’s Three Mile Island site in March 1979 gave regulators and utilities pause.
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> But a wave of optimism about electricity demand and nuclear reactor designs fueled new proposals in the early 2000s. And federal production tax credits and loan guarantees also have been designed to promote new projects. The V.C. Summer reactors were part of a proposal made in 2008.
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> If they had come online by 2021, the V.C. Summer reactors would have benefitted from federal production tax credits. That would have been in plenty of time with the original schedule; the first plant was due to come online in 2016 and the second in 2019. But that appears impossible now, and neither Congress nor the Trump administration has acted to extend the deadline for the credits.
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> Special provisions in South Carolina and Georgia allow utilities to charge ratepayers for a portion of power projects before they come online, a controversial way for private utilities to raise capital. South Carolina ratepayers have already kicked in $1.4 billion through surcharges on their monthly bills.
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> “We simply cannot ask our customers to pay for a project that has become uneconomical,” Lonnie Carter, Santee Cooper chief executive said in a statement. “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.”
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> Santee Cooper said that Westinghouse’s parent, Toshiba Corp., has contractually agreed to pay Santee Cooper $976 million in a settlement beginning later this year and continuing through 2022. Santee Cooper will use these funds to avoid new debt and stabilize rates. The company said it would continue to pursue Westinghouse’s assets in bankruptcy court to obtain further payment.
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> SCANA chief executive Kevin Marsh said in a statement that “many factors outside our control have changed since inception of this project.” He said that “chief among them” was “the bankruptcy of our primary construction contractor, Westinghouse.”