Disruptor of the Year: Westinghouse Electric Co.
Westinghouse Electric Co.
Jose Emeterio Gutierrez
Primary contractor for two major nuclear projects in the U.S.: V.C. Summer and Vogtle.
Biggest move made:
Filed for Chapter 11 bankruptcy, driving South Carolina utilities to abandon V.C. Summer nuclear expansion.
Duke Energy shelved plans to expand or build new nuclear generation in the wake of Westinghouse's bankruptcy.
Bankruptcies make headlines all the time. But few have thrust chaos and uncertainty into an industry quite like Westinghouse Electric Co's surprise bankruptcy earlier this year.
The nuclear engineering firm was the main contractor for two prominent nuclear construction projects in the Southeastern United States: the V.C. Summer expansion in South Carolina and the high-profile construction on Southern Co.’s Vogtle plant.
Both projects faced burgeoning budgets and missed deadlines for years, drawing scrutiny from regulators. Then Westinghouse filed for bankruptcy protection in March.
The news stunned the power sector, potentially dooming new nuclear build in the U.S. Westinghouse’s parent company, Toshiba, split into four subsidiaries to protect itself against the fallout, and utilities involved in these nuclear projects were unsure whether the nuclear engineering firm would continue working with them as primary contractor.
V.C. Summer owners SCANA and Santee Cooper eventually pulled the plug on the expansion project in July. Earlier reports emerged costs for the project could hit as high as $25 billion — well above the original $11 billion budget.
Toshiba announced that its subsidiary, Westinghouse Electric Co., a nuclear engineering firm overseeing major nuclear projects in the Southeast, will file for bankruptcy at the end of the month. The news sparked fears over the ongoing construction of SCANA and Santee Cooper’s V.C. Summer nuclear expansion and Southern Co.’s Vogtle nuclear project, potentially dooming new nuclear build in the U.S.
Parent company Toshiba announces plans to split into four subsidiaries to protect itself from the fallout of the Westinghouse bankruptcy.
SCANA, one of the V.C. Summer nuclear plant owners reach interim agreements with Westinghouse to continue construction while the nuclear firm undergoes bankruptcy proceedings. Southern also agrees to take over construction of Vogtle.
Southern and Westinghouse strike an agreement to complete the Vogtle nuclear plant expansions. SCANA and Santee Cooper also reach new construction agreements with the nuclear firm as well.
SCANA and Santee Cooper abandon the Summer nuclear expansion project over fears costs would climb to $25 billion.
Southern Co. pledged to continue work on the Vogtle expansion project, despite spiraling costs and delays to the projected in-service date. Meanwhile, Duke Energy announces plans to end its Levy Nuclear Project.
The Georgia Public Service Commission approved a scheduling order to set a series of hearings on the Vogtle nuclear construction for February. Duke shelved proposed nuclear expansion plans.
Westinghouse Electric Corp. bankruptcy
In Georgia, Vogtle’s owners scrambled for their next move as the fate of their project hung in limbo. An E&E News report revealed that Southern CEO Tom Fanning made at least six visits to DOE in the course of five months in hopes of scaring up some financial help. All these efforts came as Southern neared a deadline to file its quarterly construction update in August, which would signal whether the utility intended to terminate the project.
Ultimately, Southern recommended to continue construction. The utility now faces a series of hearings from the Georgia Public Service Commission over the plant’s final fate. The aftershocks from Westinghouse’s bankruptcy continue to rock South Carolina. Shortly after the utilities decided to abandon the project, Gov. Henry McMaster called for selling Santee Cooper, and lawmakers pushed for a special session to deal with the debacle. Both CEOs of the utilities resigned or retired in the wake of controversy.
But the fallout hasn't stopped at this project: Southeastern utility Duke Energy also shelved plans to expand or construct new nuclear units.
The nuclear industry is now on a quixotic quest for some sort of lifeline. Some have pinned hopes on small modular reactors; but the only U.S. developer (NuScale) is at least five years away from rolling out the first one.
GOP Congressmen have wrapped nuclear credits in a new tax package, and the Trump administration proposed a rulemaking aimed at propping up nuclear and coal plants in the competitive markets. Despite these efforts, the future of new nuclear build in U.S. continues to remain bleak.
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