A previously-secret audit shows two South Carolina utilities were well-aware of serious problems on the V.C. Summer nuclear construction project at least a year before ultimately abandoning it.
The audit is known as the “Bechtel report,” after the construction firm which reviewed the massive project in Fairfield County last year. The auditors warned the project’s lead contractor Westinghouse had no schedule in place for when work would be complete and, in fact, did not even have a finished reactor design for the specific site, despite being years behind schedule.
“There are approximately 15 to 18 months of sustained detailed design engineering to be completed… for the AP1000 standard plant and the V.C. Summer site-specific design,” the report noted.
Gov. Henry McMaster’s office released the report Monday after a spokesman said they received a copy from state-owned utility Santee Cooper earlier in the day. Santee Cooper board chair Leighton Lord turned over the report after pressure from McMaster and several state lawmakers, who threatened to fire the board. Lord said there had been legal concerns about the report, since it was done jointly with private utility South Carolina Electric & Gas (SCE&G).
Bechtel conducted the audit in February 2016, as both utilities were about to enter into a contract with Westinghouse that would increase the amount they paid into construction, but also required Westinghouse to pay any additional costs above that amount. Westinghouse ultimately filed for bankruptcy earlier this year, dooming the project.
The Governor’s Office made the audit public, despite specific requests against it from Santee Cooper. Utility officials insisted the report was protected by attorney-client privilege as the utilities prepare for lawsuits. But McMaster’s staff disputed that. The governor told reporters last week he was not even aware of the report’s existence until state regulators mentioned it in hearings with legislators.
The audit cited serious management issues with Westinghouse and the consortium of construction companies, in particular a lack of definitive timelines, high turnover, lack of shared vision and accountability. It also noted SCE&G and Santee Cooper did not offer incentives that would “commercially motivate” the project’s former contractors. The report also blamed the structure of multiple companies involved, which would often cause delays as a single change under strict nuclear construction regulations would have to work its way through the bureaucracies of several companies.
An SCE&G spokesman said the utility made changes in response to the recommendations. However, the utilities slowed work after Westinghouse filed for bankruptcy in May. Faced with an uncertain future and more than $9 billion combined sunk in the project, Santee Cooper pulled out of further construction on July 31. SCE&G announced in response that it would abandon the project.