The owners of the V.C. Summer Nuclear Station believed a detailed construction schedule by their builder was the basis for the timing and cost of adding two reactors at the aging Midlands power plant.
They've since learned it doesn't exist, calling into question repeated assurances made to state regulators that the new units can be built by 2020 and at a $14 billion price tag.
The missing documentation is one reason it's taking V.C. Summer partners Santee Cooper and South Carolina Electric & Gas parent SCANA Corp. so long to decide whether to finish one or both reactors or to scrap the project entirely after lead contractor Westinghouse Electric Co. filed for bankruptcy in March.
The two owners — SCANA has a 55 percent share while Santee Cooper owns the rest — are having to put together an integrated project schedule that they thought Westinghouse already had.
Meanwhile, billions of federal dollars could be on the line depending on which direction the project — whose costs and delays have spiraled — ultimately takes.
"Westinghouse has clearly failed to perform according to our contract for the V.C. Summer project," Santee Cooper spokeswoman Mollie Gore said, adding that the Moncks Corner-based utility "is participating in a comprehensive review of data and documents that will help us clarify some of the details."
"Once that evaluation is complete, we can talk more completely about the situation and our plan for the next step," Gore said.
That process won't be easy.
An integrated project schedule includes highly detailed information about the specific materials, manpower, time and dollars that are needed for each step of the construction process. Without it, the costs and deadlines are largely guesswork.
And until it's completed, Santee Cooper and SCANA can't be sure how long it will take to build the new reactors, how much they will really cost or whether it's even worth pursuing the project any further.
The project has already been a burden to ratepayers, according to consumer interest groups like AARP.
To date, SCE&G customers have paid $1.4 billion for the project through rate hikes that have increased the average monthly bill by about 20 percent — more than $23 per customer every month.
Santee Cooper increased customers' rates by 3.7 percent in both 2016 and this year to help pay for the units, and the utility's board of directors will consider another rate hike on Monday.
"Santee Cooper and SCANA are struggling to figure out what's going on because they had been led to believe by Westinghouse that there was a schedule that existed, or was being prepared," said Mike Couick, CEO of the Electric Cooperatives of South Carolina, which represents the state's 20 customer-owned power co-ops.
The fact that a project could proceed for so long — the reactors were approved in 2009 — without the needed documentation was called a "stunning admission" by environmental groups opposed to the V.C. Summer expansion.
"I'm just floored that they haven't been able to produce a schedule for their own project," said Tom Clements with Friends of the Earth, a network of environmental groups and activists. "That violates a basic tenet of sound construction management, and I think it reveals that there are more problems to be encountered if the project continues."
Friends of the Earth and the Sierra Club filed a complaint with state regulators Thursday, calling for a hearing on whether construction should be allowed to move forward and whether the utilities should be forced to pay back money customers have already spent through higher rates to build the reactors.
The S.C. Public Service Commission has approved the request and a hearing date is set for Aug. 14 in Columbia.
Santee Cooper and SCANA face a Monday deadline to make a decision on V.C. Summer's future, but previous deadlines have been extended and Monday's might be as well.
Meanwhile, the two South Carolina utilities have already sunk $8.9 billion into reactors that are only 37 percent completed. And they are spending roughly $30 million more each week to keep construction going.
No firm fix on things
Santee Cooper and SCANA apparently didn't realize the extent of the scheduling problem until after Westinghouse filed for bankruptcy protection.
During hearings in November and February, and in conference calls with financial analysts, SCANA executives promised that Westinghouse would turn over a copy of the schedule so it could be shared with regulators.
"We will be reviewing the corresponding integrated project schedule ... once they provide it to us," Kevin Marsh, SCANA's chairman and CEO, said in a Feb. 12 conference call.
Two months later, Stephen Byrne, a senior vice president at SCANA, told the Public Service Commission that Westinghouse "has owed us that schedule for, really, quite some time."
"They were deficient in getting back to us," Byrne said, adding that Westinghouse's input at this point probably is of little value.
"I don’t know, though, that I’m all that interested in their schedule any longer," he said.
Hindsight shows Westinghouse overextended itself when it acquired CB&I Stone & Webster Inc. — V.C. Summer's previous construction contractor — in a 2015 deal that created a new construction consortium with Fluor that was supposed to make the project more efficient.
"When they acquired Stone & Webster, they made some assumptions about improvement efficiency to the tune of about 30 percent improvement," Byrne said during the conference call. He added: "They have not seen those improvements."
David Seaton, Fluor's chairman and CEO, declined to answer questions about the construction timeline during a conference call with financial analysts last month. However, Seaton conceded "the schedules are a little bit in question."
Couick, the electric cooperatives executive, said those with a stake in the nuclear plant — including ratepayers — "need to know where we are, how much longer it's going to be, and we need to be able to measure progress."
"If you ask people right now where are we, there are a variety of answers," he said. "We don’t have a firm fix on things."
Clements of Friends of the Earth said that's one reason environmentalists are demanding a formal hearing.
"It's time they explained why there is no schedule and no cost estimate and why they have not had this for over a year," he said last week.
The state's Office of Regulatory Staff, which represents the public's interests in utility regulations, said it supports the hearing but stopped short of endorsing the environmentalists' complaint.
SCANA spokeswoman Rhonda O'Banion said the hearing isn't necessary because the Cayce-based company has already assured regulators that it "will file for a complete and thorough review of the result of our evaluation when completed."
In the meantime, that evaluation continues.
"Our focus remains on a thorough analysis and evaluation that includes a broad range of considerations as we work to determine the most prudent path forward for the project and our customers," O'Banion said.
V.C. Summer's ultimate price tag is anybody's guess at this point. Already beset by financial problems, the reactors' cost has soared by 21.6 percent since the project was announced, to an estimated $14 billion. A Morgan Stanley report in March said the final cost could be as high as $22.9 billion — double the original estimate.
The completion date is just as uncertain. The first reactor was supposed to be online by mid-2016, but that deadline has repeatedly been extended, and the latest estimate is for both reactors to be finished by the end of 2020.
That's a key date because the project is in danger of losing eligibility for nearly $2.3 billion in federal tax credits if both reactors aren't online before Jan. 1, 2021. That's billions of dollars the utilities have promised to use to lower their customers' costs.
Congress is considering a bill that would extend the deadline and keep the tax credits alive. The U.S. House of Representatives approved the bill last week but it's future in the Senate is debatable, with several lawmakers in that chamber calling the measure a bailout for an industry with a history of financial and environmental mismanagement.
U.S. Rep. Tom Rice, R-Myrtle Beach, the Congressman who filed the bill to keep the tax credits alive, says the bailout claim is "absurd."
"This is no change to what existed before," Rice said. "All it does is allows a little more time."
For environmentalists like Clements, time has already run out on the V.C. Summer project.
"We need a thorough, public review of the project, including its abandonment, before more billions of dollars are wasted," Clements said. "Now is the time to take our state's energy planning out of the hands of utilities and place development of energy policies in the hands of the public, which wants to see vigorous pursuit of least-cost, clean-energy options."