2017-08-28 / Front Page

Duke Energy (again) axes nuke plant project

By TIM GULLA
Ledger Staff Writer

Given recent developments that cast increasing doubt on the future of nuclear projects, State Sen. Harvey Peeler said he was not surprised by Duke Energy’s decision Friday to pull the plug on development of the proposed William States Lee III Nuclear Station in McKowns Mountain.

He was disappointed, however.

“We kind of feel like Charlie Brown,” he said, “and Lucy keeps pulling the football away.”

Duke Energy Carolinas announced its plans to stop development of the proposed facility in Gaffney as part of a request Friday for a rate increase for its customers in central and western North Carolina. It marked the second time Duke has cancelled plans for a nuclear plant in McKowns Mountain. A similar project at the same site was abandoned in the early 1980s.

The rate hike filing with the North Carolina Utilities Commission proposes an overall increase of 13.6 percent on electric rates, including a residential rate increase of 16.7 percent. Duke says that would mean the typical homeowner would pay about $18.72 more per month.

If approved, the rate increase in North Carolina would generate an additional $647 million a year for Duke, which said it needs the money for coal ash cleanup, modernization programs, investments in other forms of energy and to offset the costs spent on the Lee Nuclear Station project.

The cancelled nuclear project represents a sizable chunk of the money. Duke specifically notes in its filing that it is seeking approximately $53 million a year for the next 12 years for costs associated with the Lee project. As of Aug. 1, according to a previously filed financial document, Duke informed regulators that it has spent about $542 million on the project over the past six years.

It’s likely that Duke customers in South Carolina will also have to help pay for the cancelled project.

“Investment in the development of new generation is a cost typically paid for by customers, but Duke Energy is not yet seeking cost recovery in South Carolina,” Duke spokesman Ryan Mosier said Friday in an e-mailed response to questions. “That will happen in a future rate request proceeding in South Carolina, but not this year.”

Duke’s decision on the Lee project stems from the bankruptcy of Westinghouse Electric, the maker of the AP1000 nuclear reactors planned for the site, and the recent decision by SCE&G and Santee Cooper to halt construction of a similar nuclear power plant at the V.C. Summer plant in Fairfield County, which was billions of dollars over budget and years behind schedule.

“The uncertainty regarding future construction of an AP1000 unit in the United States as a result of the Westinghouse bankruptcy has created an unacceptable level of risk to continuation of the project at this time,” Duke wrote in its filing to North Carolina regulators. “This critical factor renders it infeasible for the company to construct and commence operation of the Lee Nuclear Station before the end of the next decade. Therefore, it is no longer reasonable to continue with the project as originally contemplated. As a result, the Company believes it serves customers’ best interests to cancel the project.”

Duke noted in its filing, however, that it can never say never when it comes to nuclear energy. It said it will hold onto the combined construction and operation license it received from the U.S. Nuclear Regulatory Commission to build the proposed Lee plant, noting the license does not expire for 40 years.

While that might be so, Duke can’t simply build whatever it wants. Roger Hannah, a spokesman for the U.S. Nuclear Regulatory Commission, says the license Duke received is tied to the AP1000 reactor. “If Duke were to, at some point in the future, say they want to build some other type of (nuclear) plant, they would have to file for a license amendment,” Hannah said.

Duke wouldn’t have to start the process from square one, Hannah noted, but there still would be a thorough technical review.

Several former property owners near the planned site, such as Robert Albertson, know what they would like. They would like their property back.

Albertson and his wife, both of them former Duke employees, were living on Darby Road when they were contacted by real estate personnel on Duke’s behalf. The Albertsons had 10.5 acres and Duke wanted extra property for the creation of a large cooling water pond. “Buy what you need,” Albertson remembered telling them, “and we’ll have lakefront property.” But that wasn’t what Duke had in mind, Albertson said. “They wanted it all.”

The Albertsons not only had a home on the property but a large building and a deer processing business. “We had no choice,” Albertson said. It was either sell to Duke or they would be taken to court and an appraiser would set the value. And the money, he assured, didn’t cover everything.

Peeler said he would be making two specific requests of Duke Energy now that the plant has been cancelled. The first is “Don’t raise our rates because of this,” he said.

The second is to open the land for economic development and the expansion of recreational opportunities along the Broad River.

“I’ve been pushing opening up the Broad River for recreation for a long time,” he said. “Maybe we can make something good out of a bad situation.”

Return to top

Print Edition

Click here for digital edition
2017-08-28 digital edition

Special Sections

Poll

Should Gaffney City Council overrule the Accommodations Tax Advisory committee and grant the S.C. Peach Festival’s request for $15,000 to promote the event?