South Carolina Electric & Gas. Co. and Santee Cooper (the S.C. Public Service Authority) are under the gun now for a multibillion-dollar decision to drop construction on two nuclear reactors that were to add to South Carolna’s energy-generating capacity for decades to come.
Despite all the finger-pointing at those who lead the utilities, one a publicly traded company and the other owned by the state, the decision to move ahead with nuclear power a decade ago was made in good faith and in a different energy and political environment.
Now, abandoning (or putting on hold) further construction on the nuclear reactors at the V.C. Summer Nuclear Station in Fairfield County makes fiscal sense. And the utilities are not alone, as only one plant begun in the United States in the push for new nuclear capacity remains under construction. Prospects for that plant in Georgia are uncertain as it, like the South Carolina reactors, is far behind schedule and billions of dollars over budget.
Spending $10 billion on two nuclear reactors that will not be finished and put into service is a huge loss of ratepayers’ money, but avoiding further losses is necessary in the interest of the health of both utilities.
As to money to pay for the losses continuing to come from customers, the utilities are doing as authorized.
The General Assembly bought into the need for the new power capacity and nuclear as the way to go, passing a law a decade ago allowing investor-owned utilities such as SCE&G to charge customers up front and recoup their investments even if a nuclear project was not completed. Santee Cooper already had the authority to charge customers as it deems necessary.
The anger being expressed by a number of lawmakers is understandable as customers of the utilities are up in arms over how much they have paid for the nuclear project – and how much they stand to continue paying.
Lawmakers are right to examine what happened and consider how customers may get some relief, but no matter how much politicians fume about the matter, the fact remains that the continuing soundness of SCE&G and Santee Cooper (the sale of which would be a mistake) are vital to a growing state’s future. Undermining both would be shortsighted, with even the utilities’ harshest critics surely realizing that.
Many of those critics are the same ones having pushed for abandonment of coal-fired plants, which will now remain important for generating electricity for years to come. That is not as it was going to be in a future with clean energy – including nuclear.
Federal policy that made new nuclear plants attractive has been inconsistent – and fatal to the new nuclear projects in South Carolina and elsewhere. A decade ago, there were incentives to go nuclear in phasing out coal plants. And there was concern about the cost of natural gas, which generates a majority of the nation’s electricity. Fast forward to today and the current administration in Washington has returned emphasis to coal, and natural gas is cheap.
But what about the future?
SCE&G and Santee Cooper may be OK for now with generating capacity, but South Carolina is growing and plans to grow even more as a developing state. Failure to consider long-term needs for power would be a mistake amid the nuclear fiasco. Can nuclear yet be an ingredient here and elsewhere around a country that is totally reliant on the power grid – including for national security?
The answer is “no” -- at least for now. And that is a mistake. Nuclear power supplies about 20 percent of the nation’s power, but plants are aging and will go off line in coming years. Will the nation rely on conventional generating sources (coal, natural gas and hydro) to replace the power – or are we truly ready to commit to solar, wind and other sources in ensuring the power we have to have?
The future of nuclear energy is an urgent national matter. A policy and commitment (or lack thereof) are necessary. No utility now is going to venture into nuclear without guarantees that go even beyond those causing so much controversy in South Carolina.
Santee Cooper CEO and Bamberg County native Lonnie Carter stated correctly: "If the federal government wants there to be a nuclear energy sector in this country, they need to step forward and make sure these projects are finished. If they don't, we won't have one. As time goes on, units will retire and we'll have less and less nuclear energy."