US ceased construction on two AP1000 nuclear reactors because of delays and costs

1. Scana Corporation subsidiary South Carolina Electric & Gas (SCG&E) yesterday announced its decision to cease construction of two AP1000 reactors at VC Summer. The announcement followed co-owner Santee Cooper’s decision to suspend construction because of projected completion delays and cost overruns. Scana is to file for regulatory permission to abandon the project.

Santee Cooper said its decision to suspend construction was based “in large part” on analysis of detailed schedule and cost data provided by project contractor Westinghouse and subcontractor Fluor Corporation after Westinghouse filed for Chapter 11 bankruptcy protection in March. That data, which has now been analysed by Santee Cooper and SCE&G, shows unit 2 will not be completed until December 2022 and unit 3 not before March 2024 – four years after the most recent completion date provided by Westinghouse.

Santee Cooper and majority partner SCE&G’s original contract with Westinghouse had provided for substantial completion of Summer unit 2 by 2016 and unit 3 by 2019. In 2015 the contract was amended, fixing Santee Cooper’s share of the cost at $6.2 billion. This was approved by Santee Cooper’s board in 2016.

Santee Cooper said its most recent analysis, which anticipates the rejection of that contract as part of Westinghouse’s bankruptcy proceedings, found that completing the project would cost the company $8 billion plus about $3.4 billion in interest, with schedule delays contributing to the increased interest. It has already spent $4.7 billion on construction and interest to date for its 45% share of the project.

“After Westinghouse’s bankruptcy and anticipated rejection of the fixed-price contract, the best case scenario shows this project would be several years late and [cost] 75% more than originally planned,” Lonnie Carter, Santee Cooper president and CEO, said. “We simply cannot ask our customers to pay for a project that has become uneconomical.”

Construction began on the first of four AP1000 reactors in the USA – Summer unit 2 and Vogtle unit 3 in Georgia – in March 2013, with work beginning on Summer 3 and Vogtle 4 in November of that year. Work is still continuing at the Vogtle project, for which Westinghouse recently negotiated a long-term services agreement with co-owner Southern Nuclear Co.

AP1000s under construction in China are unaffected by the Westinghouse bankruptcy filing. Wang Binghua, chairman of China’s State Power Investment Corporation, recently vowed that his company will make sure its first two AP1000 plants at Sanmen and Haiyang will start producing electricity by end of 2017.

2. Unit 4 of the Fuqing nuclear power plant in China’s Fujian province has been connected to the grid, China National Nuclear Corporation (CNNC) announced today. The 1087 MWe CPR-1000 unit becomes the country’s 37th operational power reactor.

Summer unit 2, pictured on 9 June after placement of the unit’s third and final containment ring (image: SCE&G)