SCANA awaits new completion schedule for V.C. Summer units

SCANA (NYSE:SCG) has already seen some delay in its completion schedule for V.C. Summer Units 2 and 3 and will receive a revamped construction timetable for the reactors in the third quarter.

SCANA had previously planned for the Summer Unit 2 to go into service in March 2017. The schedule was subsequently revised to show that Unit 2 would go online in either 4Q17 or 1Q18.

Now SCANA is waiting for its vendor consortium, which includes Chicago Bridge & Iron (NYSE:CBI) and Westinghouse Electric to “re-baseline” the schedule for Unit 2 to come online.

Unit 3 will come online roughly 12 months after Unit 2. The two new nuclear units should provide SCANA with roughly 2,000 MW of additional emission-free baseload power.

During an April 24 earnings conference call with financial analysts, SCANA CFO Jimmy Addison and Steve Byrne, the COO for utility subsidiary South Carolina Electric & Gas (SCE&G) expressed optimism that any schedule delay would still fall within the 18-month contingency period set by the South Carolina Public Service Commission.

In the event that the delay pushes completion beyond that period, then the utility could be forced to seek additional approvals before the PSC, the SCANA officials said.

SCANA officials attributed some of the delay to the vendor management turnover that occurred after CB&I acquired the Louisiana-based Shaw Group in early 2013. Shaw had been the lead vendor.

CB&I is also a lead vendor for construction of Vogtle Units 3 and 4 being developed by a Southern (NYSE:SO) subsidiary in Georgia. The Vogtle and Summer projects represent the first new nuclear reactors building built in the United States in more than 30 years and there is a natural learning curve, the SCANA officials said.

Overall construction has been going well despite some work slowdowns due to some unusually cold weather in South Carolina during the first quarter, SCANA officials said.

An auxiliary building and fuel handling area module should be fabricated and “on hook” of the heavy lift derrick in May, SCANA said. The steam generator module is running a little behind schedule for Unit 2 but it should be on hook in the second or third quarter of this year.

SCANA enjoyed good first quarter

SCANA announced earnings for the first quarter of 2014 of $193m, or basic earnings per share of $1.37, compared to $151m, or basic earnings per share of $1.13, for the first quarter of 2013.

“We continue to see new business growth and expansion of existing businesses,” in the Carolinas, Addison said. North Carolina and South Carolina “are benefitting greatly from the industrial expansion,” Addison added.

Over the next 20 years, 43% of U.S. population growth will be concentrated in 10 strategic growth corridors, including parts of the Carolinas and Georgia where SCANA does business, the company officials said.

Overall, weather normalized kilowatt-hour retail sales were up 3.6%, according to SCANA.

On another topic, SCANA officials expressed hope that South Carolina’s legislature will pass a solar power bill that might serve as a model for other states.

About Wayne Barber 4201 Articles
Wayne Barber, Chief Analyst for the GenerationHub, has been covering power generation, energy and natural resources issues at national publications for more than 20 years. Prior to joining PennWell he was editor of Generation Markets Week at SNL Financial for nine years. He has also worked as a business journalist at both McGraw-Hill and Financial Times Energy. Wayne also worked as a newspaper reporter for several years. During his career has visited nuclear reactors and coal mines as well as coal and natural gas power plants. Wayne can be reached at wayneb@pennwell.com.