Builder of Midlands nuke plant purchased (copy)

Workers maneuver a 30,000-pound panel into place at one of the two new reactors that was being built at the V.C. Summer Nuclear Station in Jenkinsville. File

WASHINGTON — The pressure is off South Carolina's congressional delegation to extend a federal tax deadline for the country's nuclear power industry following the cancellation of two unfinished reactors at V.C. Summer station. 

As Republicans advance a tax overhaul bill in Congress, the likelihood of federal lawmakers passing tax credits for a new generation of nuclear power plants has diminished alongside South Carolina's failed $9 billion energy project. 

Lawmakers from the Palmetto State, who pushed the nuclear tax credits as recently as June, still believe that the incentives are good national policy but admit they now aren't as much of a priority for the state, which continues to reel from the project's collapse. 

"I think the credits certainly remain important, but it's not quite as critical as it was," said U.S. Rep. Tom Rice, R-Myrtle Beach, who first introduced the measure just a few months before utilities SCANA and Santee Cooper pulled the plug on V.C. Summer.  

The tax credits, which would shrink the final cost of new nuclear reactors by billions of dollars once they are completed, were included in the massive tax bill that passed the House in November. But the incentives were left out of the Senate's partnering tax legislation.

South Carolina's two senators and seven representatives were outraged when they failed to get the tax incentives included as part of a spending bill earlier this year after Westinghouse filed for bankruptcy and the future of the V.C. Summer project was thrown into doubt.

Concern about the omission from the tax bill has been far more muted.

The abandonment of the two partially built reactors near Jenkinsville in July ensures South Carolina won't benefit even if the nuclear credits are lumped into the Republican tax overhaul. The $2 billion in tax savings the state stood to gain vanished along with the hope of building two of the first nuclear power plants in the United States in three decades.

The energy tax incentives remain vital for Georgia, however, as a handful of utilities continue to pay for the construction of two Westinghouse reactors at Plant Vogtle near Augusta.

At this point, Georgia is the only state likely to benefit from the proposed tax credits. Thirty states have nuclear power plants in operation, but few are discussing plans to construct new ones.

U.S. Sen. Lindsey Graham, R-S.C., said he still holds out hope the South Carolina project will be revived. Even if it isn't, he still supports the nuclear tax credits.

"I want to help our friends in Georgia," Graham said.

But in a sweeping tax overhaul package, smaller considerations, like the nuclear credits, need vocal advocates in Congress willing to expend political capital in order to stand any chance of rising above the countless other pet issues lawmakers want to include.

The removal of any direct impact on South Carolina reduces the urgency for the state's delegation. That's a blow for the nuclear industry, who view the incentives as essential for a "nuclear renaissance" in the country and had been relying on South Carolina and Georgia to lead the charge on pressing for the extension like they did earlier this year. 

"Will it be a casualty of the process? I don’t know," said U.S. Rep. Mark Sanford, R-Charleston. "But it doesn’t enhance their position."

U.S. Rep. Joe Wilson, R-Lexington, said he still wants the extension because his Midlands district is adjacent to the Vogtle plant. But while "it would be an issue" if the final bill did not include the extension, he acknowledged "it wouldn't be one that would be a determining factor" for his vote.

South Carolina's federal lawmakers have also yet to call for a federal investigation by the Nuclear Regulatory Commission, the country's nuclear watchdog agency into the nuclear fiasco. 

State law enforcement officers, a federal grand jury and the Securities and Exchange Commission have all opened investigations into the canceled nuclear reactors in recent months.

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The NRC, however, has yet to open a review of the decade-long project, even as outside groups requested an investigation into Westinghouse's decision not to use professional engineers to design the reactors. Some lawmakers said they never heard the revelations that unlicensed workers were designing parts for the reactors.

U.S. Rep. Ralph Norman, R-Rock Hill, whose district includes V.C. Summer, said the project's cancellation should serve as a "wake-up call" for other states that consider similar efforts in the future.

"The silver lining is it’s making people aware of oversight of a project like this," Norman said. "It’s making people aware in government not to let the power companies off the hook."

Another positive, Norman said, is that the energy vacuum creates more need for other sources of energy he has supported, such as solar. 

Rice also still wants to include the incentives in the final tax reform bill that is expected to be negotiated before the end of the year, but he is now skeptical that the credits will be extended to other nuclear projects in the future. 

"I think if new projects come along at this point they're going to have to be done without these incentives," he said. 

The failure of South Carolina's project also provides ammunition to longtime critics of the nuclear industry more broadly, such as U.S. Rep. Lloyd Doggett, D-Texas, who was the only House member to speak out against the tax credit extension when it came up for a House vote earlier this year and now expressed vindication.

"The nuclear industry is always asking for one handout after another and then they bail out," Doggett said. "It's a ripoff, and it's tragic that the ratepayers in South Carolina end up picking up the cost."

Since its cancellation in July, the V.C. Summer nuclear project has devolved into consumer lawsuits and a legal battle over who should pay for the $9 billion failure. 

Jamie Lovegrove is a political reporter covering the South Carolina Statehouse, congressional delegation and campaigns. He previously covered Texas politics in Washington for The Dallas Morning News and in Austin for the Texas Tribune.