In January, South Carolina utility Santee Cooper made the first public move in what’s likely to be a years-long process to either complete construction on or find “alternative uses of” the two unfinished nuclear reactors at its Virgil C. Summer nuclear power plant. 

Citing an expected surge in electric load from “advanced manufacturing investments, AI-driven data center demand, and the tech industry’s zero-carbon targets,” Santee Cooper CEO touted the potential for V.C. Summer Units 2 and 3 “to generate reliable, carbon emissions-free electricity on a meaningfully shortened timeline” relative to entirely new nuclear power plants.

Rather than take responsibility for completing the two 1,117-MW AP1000 reactors, which have been mothballed since July 2017, Santee Cooper tapped investment bank Centerview Partners to lead a request for proposals from parties interested in acquiring the project. Responses are due May 5.

It’s not certain that the RFP process will produce a workable completion plan. If it does, the new units could be completed and commissioned within five to eight years, pending a thorough site audit, experts told Utility Dive. 

What happened at V.C. Summer — and who could take over?

Santee Cooper and co-owner South Carolina Electric & Gas Company began construction on V.C. Summer Units 2 and 3 in 2013. After four years and $9 billion invested, the partners agreed to terminate the project amid slower-than-expected progress, ballooning cost estimates and the bankruptcy of Westinghouse, the primary contractor.

The debacle led to the mass firing of all South Carolina Public Service Commission members and the near-collapse of SCE&G parent company SCANA Corporation, which Dominion Energy purchased in 2019. Two executives from SCANA and two from Westinghouse later faced criminal charges for their roles in falsifying corporate records related to the project and lying to federal investigators.

The U.S. Nuclear Regulatory Commission approved the project co-owners’ request to terminate its combined operating license in 2019.

Though South Carolina ratepayers continue to pay for construction costs incurred in the 2010s, policymakers’ interest in completing the project has grown as the state’s population and its manufacturing sector boom. In his January state of the state speech that called out proposed reforms to speed development of new gas and nuclear generation in South Carolina, Gov. Henry McMaster, R, said the project could “usher in a nuclear power renaissance across the country.”

“Restarting these two reactors will not only help fuel our state’s future power needs, but will also … spur nationwide investment and construction of new nuclear power generation,” he said.

The abandoned construction site “is actually in pretty decent shape,” according to a state nuclear advisory council member who visited last year. Santee Cooper CEO Jimmy Staton told state legislators in January that the utility sent seven non-disclosure agreements to companies interested in participating in the project.

Serious RFP responses will likely come from groups led by “a financial-type organization” or a large company “[willing] to spend a substantial amount of money upfront to restart construction,” said Eugene Grecheck, principal at Grecheck Consulting and former president of the American Nuclear Society.

But given the V.C. Summer project’s checkered history, a bilateral offtake agreement like the 20-year deal between Microsoft and Constellation Energy for 835 MW of power produced at the restarted Crane Clean Energy Center is unlikely, said Juliann Edwards, chief development officer at The Nuclear Company, which aims to enable deployment of 6 GW of new nuclear capacity in the next decade. Edwards characterized The Nuclear Company as a “spectator” to the V.C. Summer RFP process.

“I don’t see a world in which the ratepayers or [local] large industrials don’t benefit from the power,” Edwards said. Power-hungry manufacturers like steelmaker Nucor have a long-established and growing presence in the Carolinas, she noted.

A possible operating model

The pool of potential licensees, and eventual operators, is a smaller set that could include major utilities with experience operating nuclear power plants in the region — such as Duke Energy, Dominion Energy and Southern Company, Edwards said.

Dominion Energy operates and owns two-thirds of V.C. Summer Unit 1. But Dominion currently has “no contractual or legal involvement in anything that might happen at [Units 2 and 3],” Grecheck said.

The unfinished units’ future owners may settle on an operational model that looks something like the Nuclear Management Company, a now-defunct operations firm formed by a five-utility consortium around 2000 to operate six nuclear plants in the Upper Midwest, Grecheck said. NMC operated the plants on a “cash for services” basis, but did not own the facilities or their output, reducing its financial risk, he said.

In any case, the ownership group and licensee would need to take on a substantial amount of risk to see the V.C. Summer project through to commissioning, or find “creative ways” to mitigate that risk, Grecheck said. 

“Federal financing or loan guarantees would make [that] more palatable,” he said. 

The U.S. Department of Energy is expected to reorient its priorities around firm energy resources like gas, geothermal and nuclear, experts say, but DOE’s Loan Programs Office — which is sitting on tens of billions in authorized but unspent funding — has effectively been silent since the final week of the Biden administration. DOE did not respond to a request for comment.

What’s needed to complete V.C. Summer Units 2 and 3?

Regardless of the federal financing situation, the state nuclear advisory committee’s November report on the site’s better-than-expected condition “was a really important step” that increased public confidence in the project’s viability, said Craig Stover, senior program manager of the advanced nuclear technology program at the Electric Power Research Institute. 

Though its condition is unclear, the fact that crews completed the switchyard meant to serve the new units before abandoning the project is also likely a positive, Stover said. Still, any prospective owner would need to conduct a much more thorough inspection of the site, its equipment and associated quality assurance paperwork to determine how much remediation is required, he added.

Such inspections can surprise in unwelcome ways, Grecheck said. He cited the decades-long saga of the Tennessee Valley Authority’s unfinished Bellefonte Nuclear Generating Station, a roughly 2,500-MW Alabama facility abandoned in 1988 with its two units estimated at 90% and 58% completion. But following “subsequent asset recovery activities, along with more recent inspections of remaining equipment,” TVA backed down its respective completion estimates to 55% and 35%, the agency said in 2009. 

TVA sold the Bellefonte site in 2016 to a group headed by a local property developer intent on finishing construction, but backed out of the transaction two years later and withdrew its construction permit in 2021, likely dooming the project for good.

Ascertaining equipment condition is difficult after a long period of inactivity, especially without comprehensive maintenance records, Grecheck said. It’s a marked contrast to the “known quantities” involved in the ongoing efforts to restart the prematurely retired reactors at the Palisades, Duane Arnold and Three Mile Island nuclear power plants, all of which operated reliably for decades, he said.

In some ways, the never-begun aspects of the project may be less risky to complete, said Kate Fowler, global nuclear energy leader at Marsh Global Specialty Energy & Power, a commercial insurer.

“Then, you’re just bringing in new equipment, and the challenge there is the supply chain,” she said. “But new equipment may be easier to manage than proving existing equipment is OK to restart.”

From an insurance perspective, the V.C. Summer project “probably won’t look completely different than a run-of-the-mill construction process,” though any insurer would want to do their own, very thorough due diligence, Fowler said.

TVA’s completion of Watts Bar Unit 2 in 2016, after a 22-year hiatus from 1985 to 2007 and further design modifications in the early 2010s in response to the Fukushima Daiichi disaster in Japan, shows that — contra Bellefonte — it is possible to successfully resume construction on mothballed fission power plants in the United States, Fowler said.

Still, it won’t be quick or easy. Until more is known about the site’s status, none of the experts interviewed by Utility Dive would hazard a guess as to how much completing V.C. Summer Units 2 and 3 would cost. As for the project’s duration, Grecheck said it could be done in five years or less, assuming a competent project management team pursued licensing, workforce development and procurement efficiently and in parallel, while Stover predicted a seven-to-eight-year time frame. Edwards and Fowler declined to estimate a completion date.

“I would encourage everybody involved to ground themselves in facts … [after] a thorough review,” Edwards said.

All agreed that the V.C. Summer project would benefit from lessons learned at Georgia Power’s nearby Plant Vogtle, where thousands of workers — many of whom still reside in the region — just finished building the United States’ first two operating AP1000 reactors. 

“When you compare a project like this, with so many parts that were substantially complete, it does appear to be a faster path than starting fresh,” Stover said.