Santee Cooper should be required to sell the parts to a coal-fired power plant it abandoned in South Carolina seven years ago, according to a lawsuit filed in Horry County. Conway attorney George Hearn Jr. is seeking a court order to force the state-owned power provider to unload the components it bought as it prepared to build a generating station in Florence County. The lawsuit, which seeks class-action status, argues that customers should be paid back with the proceeds.
The agency halted work on the Pee Dee project in 2009 after spending roughly $250 million for equipment and thousands of acres of land to install it. Anticipating electricity shortages on the horizon, the Moncks Corner-based utility had moved three years earlier to pursue the $1.2 billion project.
Spokeswoman Mollie Gore said Santee Cooper was still reviewing the details of the case, but the agency plans to “vigorously defend ourselves against this lawsuit.”
The plan was ultimately scuttled when Santee Cooper’s largest customer, Central Electric Power Cooperative, decided to start buying more power from Duke Energy. Central, which supplies electricity to co-ops around the state, said it was concerned about the cost of the coal plant.
Lower-than-expected electricity demand would likewise lead to the abandonment of the V.C. Summer Nuclear Station expansion in Fairfield County. Santee Cooper abandoned that project late last month as costs spiraled and construction delays mounted.
The power company’s reasoning for walking away included stagnant electricity needs. It had joined the nuclear project in 2008 hoping to stave off power shortages.
Hearn’s lawsuit, filed last week, says Santee Cooper should be required to repay customers for the proposed Pee Dee coal plant’s costs. The complaint alleges the utility failed to sell its parts in a “commercially reasonable manner,” even as the power company spends some $13 million a year to maintain the equipment if a buyer steps up.
“Santee Cooper had the opportunity to sell the unused Pee Dee plant equipment for an amount lower than the purchase price, but did not do so,” according to the lawsuit.
Hearn and lawyers representing him in the case didn’t respond to requests for comment.
Santee Cooper did make efforts to sell the plant. In 2012, for instance, it placed an ad in an industry publication marketing a ready-to-build power plant and a huge, 600-megawatt steam turbine “priced to move.”
But the sales pitch ran up against shifting economics in the energy sector. Coal plants were targeted under the Obama administration’s Clean Power Plan. And natural gas prices were plunging, dimming interest in generating electricity with coal.
Now, Santee Cooper finds itself trying to liquidate another challenging asset: its 45 percent stake in the V.C. Summer project.
The power company is shopping for buyers interested in the two partially built nuclear reactors north of Columbia, setting a deadline of Sept. 15 for another utility to come forward. The project represented one of the first new nuclear construction efforts in the U.S. in three decades, and its demise has cast doubts on the future of nuclear power in America.
So far, that effort hasn’t been successful, CEO Lonnie Carter said Monday. Two companies have reached out, he said, but neither appears to have the assets to pursue a project that would cost billions of dollars more to complete.