After two years of negotiations with Duke Energy to sell a share of two reactors under construction at the V.C. Summer nuclear plant, Santee Cooper announced Monday it will instead sell 5 percent of the project to South Carolina Electric & Gas.
SCE&G currently owns 55 percent of the project, with Santee Cooper holding the rest. Facing a decline in projected power demand, the latter utility had negotiated with Duke to sell 5 percent to 10 percent of the project. But The State newspaper in Columbia, S.C., quoted a Santee Cooper spokeswoman as saying the companies could not reach a deal.
Instead, SCE&G will increase its portion of the project at an estimated cost of about $500 million, according to a release. The transaction will occur in stages, following completion of the first AP1000 reactor at V.C Summer in 2017 or 2018. Pending regulatory approval, the deal also stipulates that Santee Cooper cannot sell any more of its ownership interest in the units until after they are finished.
"The past few years have shown unprecedented volatility in base load fuel costs and increasing regulatory pressures on fossil-fueled generation. Today's action reduces our costs to customers somewhat, while still preserving an ownership level that will position us well for the flexibility we will need going forward," Santee Cooper CEO Lonnie Carter said in a release.
Kevin Marsh, the CEO of SCE&G parent company Scana, was quoted as saying, "The addition of approximately 110 megawatts from this purchase will help us replace a portion of 345 megawatts of older coal fired generation expected to be retired over the next five years. … A 5 percent increase in our ownership of the new nuclear project will delay the need to build new gas fired capacity after 2020 with clean, non-emitting nuclear energy."