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Santee Cooper to feds: Stop SCANA from dropping permits for failed nuclear project

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Nuclear Power Station (copy) (copy)

SCANA wants to abandon billions of dollars worth of equipment and material at V.C. Summer to collect a huge federal tax write off. But Santee Cooper isn't ready to walk away for good. File/Grace Beahm/Staff

Santee Cooper has asked federal regulators to stop SCANA Corp. from giving up its licenses to build a pair of nuclear reactors north of Columbia, a move that could imperil billions in tax credits meant to pay down the project's costly failure.

The two South Carolina utilities have been squabbling over what to do with the lucrative licenses, which gave them the go-ahead to expand the V.C. Summer Nuclear Station in Fairfield County. With Santee Cooper's request on Monday, it's up to the U.S. Nuclear Regulatory Commission to decide if the permits will be cancelled — and when.

The consequences could be substantial for South Carolina's electric customers: If SCANA is forced to keep the licenses, it could lose a tax write-off worth $2 billion that it hopes to receive for walking away from the V.C. Summer project.

SCANA plans to pass those savings on to customers of its subsidiary, South Carolina Electric & Gas, who currently pay $37 million a month for the failed project. Santee Cooper, a government-owned utility, wouldn't benefit from a write-off because it doesn't owe income taxes.

Meantime, if the permits are dropped, South Carolina's nuclear ambitions would be all but dead because of the years-long process of getting approval for a reactor. The V.C. Summer expansion was called off in July because of spiraling costs, but lawmakers want the site preserved in case the economics of nuclear power turn around — especially after the utilities torched $9 billion on the project.

The question of what becomes of the permits has been simmering for months. SCANA had offered to give them to Santee Cooper for free, in return for paying maintenance costs on the unfinished reactors and picking up legal liability.

Santee Cooper, however, balked at the idea of bearing all the risk for a project it had co-owned with SCANA. In its letter to federal regulators, the utility said it still hasn't decided whether to pick up the permits — and it doesn't want the permits to be cancelled until it has.

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The power company’s letter says it "does not consent" to having the permits withdrawn, and it asks for a six-month delay before regulators take action on the licenses.

Roger Hanna, a spokesman for the nuclear commission, couldn't immediately be reached for comment Tuesday, but earlier this week, he said the agency hadn't set a timeline for axing the permits. SCANA made its request late last month.

SCANA has said that turning in the permits is a key step in showing tax collectors that it had abandoned its stake in the nuclear project for good. The company has said the benefit to customers would be about $2 billion, though the savings would be smaller if its sale to the Virginia power giant Dominion Energy is completed. If the transaction closes, the credit would be worth about $500 million.

SCANA couldn't be reached for comment on Santee Cooper's letter. In communications with Santee Cooper, however, it has said that SCE&G customers shouldn't have to pay for the "remote possibility" that the nuclear project is restarted.

Still, the delay won praise from Gov. Henry McMaster, who wants the site to be preserved in case the reactors become viable later.

"The governor has repeatedly indicated his desire to preserve the site and the potential to one day complete the reactors," McMaster spokesman Brian Symmes said in a statement. "He’s pleasantly surprised that Santee Cooper has requested more time to consider all factors involved in this decision."

Andy Shain of The Post and Courier contributed to this report.

Reach Thad Moore at 843-937-5703. Follow him on Twitter @thadmoore.

Watchdog and Public Service reporter

Thad Moore is a reporter on The Post and Courier’s Watchdog and Public Service team, a native of Columbia and a graduate of the University of South Carolina. His career at the newspaper started on the business desk in 2016.

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