Fraud and Imprudence: Hearing into South Carolina Electric & Gas on Failed Nuclear Reactor Construction set for Nov. 1
Friends of the Earth and Sierra Club set to call on South Carolina Public Service Commission to Halt Charges for Project and Refund $2B Already BilledCOLUMBIA, S.C. – In a high-stakes hearing set to begin Thursday, November 1, Friends of the Earth and the Sierra Club will call on the South Carolina Public Service Commission to refund consumers for the failure of the VC Summer nuclear plant. In the multi-week inquiry into the terminated nuclear reactor construction project by South Carolina Electric & Gas, the PSC will hear arguments over who should pay for $2 billion in financing charges already billed to customers, and who will be responsible for the full $5 billion in construction costs.
By state law passed in July 2018, the PSC must rule in the matter by Dec. 21.
In testimony filed in advance of the hearing, Friends of the Earth and the Sierra Club contend SCE&G must be held responsible for all costs incurred since construction was approved by the PSC in February 2009. In the lead-in to the hearing, which is expected to last three weeks, the groups have been the main advocates for the public and will present evidence that the company acted “imprudently” from the project’s inception in 2008.
“The evidence in this case is irrefutable that SCE&G hid key information as the project unraveled and did not act prudently from the start,” said Tom Clements, senior adviser with Friends of the Earth and who has tracked the project since its inception. “Given SCE&G disturbingly wasteful spending on this failed nuclear project, the PSC can only determine that customers must not be held responsible. Customers have been hit repeatedly with rate hikes since 2009 to pay for the bungled project. It’s finally time for the PSC to make sure that SCE&G and its shareholders are held responsible for the company’s egregious and deliberate mistakes.”
The two public interest groups will kick off the first day of the proceedings with regulatory expert Dr. Mark Cooper, who will argue that changes to customers’ and construction costs were imprudently incurred and that the PSC should rule that customers must be refunded what they have already paid and not be charged any additional costs. Dr. Cooper’s oral testimony will be presented on the first day of the proceeding after five-minute opening statements are made by the host of participating parties.
Friends of the Earth and Sierra Club lawyer Bob Guild, who has vigorously pursued the case since the groups filed their complaint on June 22, 2017, will question Dr. Cooper. Additional witnesses will include individuals from the S.C. Office of Regulatory Staff, SCE&G/Dominion, AARP, the Southern Alliance for Clean Energy, Coastal Conservation League of S.C. and the S.C. Energy Users Committee.
SCE&G and their partner Santee Cooper (45 percent owner) canceled the twin-reactor V.C. Summer project on July 31, 2017, after incurring massive cost overruns and significant schedule delays. The two companies could not bear the rapidly escalating costs which pushed the cost of the project from an initial $10 billion to $25 billion. SCE&G and Dominion Energy, a Virginia-based company trying to take over SCE&G’s parent company SCANA, aim to maximize charging of project costs to ratepayers while letting their shareholders almost completely off the hook.
Friends of the Earth first challenged the project before the PSC in May 2008 and the Sierra Club followed suit, with the last intervention in 2016. In the group’s jointly filed complaint with the PSC in June 2018, the groups contended 1) that spending on the project be halted — achieved when the project was terminated — 2) that money be refunded to ratepayers and charging for the project be halted and 3) that clean energy alternatives must be pursued by SCE&G.
Given extremely limited seating in the PSC hearing room, the public is urged to arrive by 9 a.m. on Nov. 1. The hearing will begin at 10 a.m. The event will be livestreamed here.
Unfortunately, the PSC has assigned only 25 seats to the public, while giving SCE&G/Dominion around 40 seats for their staff and contractors.
According to Friends of the Earth’s Tom Clements, “The PSC failed to listen to requests to find a larger room and the severe restriction on public seating belies the word ‘public’ in the PSC’s name. Based on the way the PSC has chosen to assign seats, it rather looks like the PSC and staff are watching out more for the executives who made very bad decisions and stole our money rather than for ripped-off customers. The pressure will be on the PSC to prove us wrong and show they are watching out for SCE&G’s beleaguered customers.”
Tom Clements of Friends of the Earth will be available for interview in the days before the hearing starts and on Nov. 1 and 2, when the Friends of the Earth/Sierra witnesses will be on the stand.
Expert contact: Tom Clements, (803) 240-7268, [email protected]
Communications contact: Patrick Davis, (202) 222-0744, [email protected]
Notes:
1. SC PSC hearing officer directive, October 9, 2018 – FOE/Sierra Club witness goes first on November 1, 2018 opening day of hearing:
https://dms.psc.sc.gov/Attachments/Matter/179ba2e3-3b28-4e82-9788-9e17cdaffd08
2. PSC hearing officer’s seating chart for the hearing, October 25, 2018, with inadequate space for the “public” (could also be utility connected people) and abundant seating for SCE&G/Dominion staff, lawyers and contractors:
http://www.srswatch.org/uploads/2/7/5/8/27584045/hearing_room_diagram_-_w-audience_seating_nov_1_2018.pdf
Chart amended October 30, 2018: https://foe.org/wp-content/uploads/2018/10/seating-Hearing-Room-diagram-w-audience__-seating-28229-1.pdf
3. Docket 2017-207-E – complaint first filed by FOE/Sierra on June 22, 2017, six months before SCE&G/Dominion filed its project abandonment and merger case:
https://dms.psc.sc.gov/Web/dockets/Detail/116365
4. New payment proposal – “Alternative Plan” – offered by Dominion CEO Tom Farrell to force SCE&G ratepayers to pay for failed project for 20 years, proposed via testimony filed with the PSC on October 25, 2018; proposal a bit better that the “$1000 check scam” Dominion has been touting all year:
https://dms.psc.sc.gov/Attachments/Matter/8c5db7aa-8d8a-49af-8933-7e282156ce95
5. Initial opposition to SCE&G’s nuclear project by Friends of the Earth, May 2008, before the PSC in Docket 2008-196-E: “Combined Application of South Carolina Electric & Gas Company for a Certificate of Environmental Compatibility and Public Convenience and Necessity and for a Base Load Review Order for the Construction and Operation of a Nuclear Facility in Jenkinsville, South Carolina”:
https://dms.psc.sc.gov/Web/dockets/Detail/103552
6. List of known witnesses: https://foe.org/wp-content/uploads/2018/10/Cast-of-Characters-Nuclear-Dockets-2017-370-E3b-2017-207-E3b-2017-305-E-As-Revised-No.-2.pdf