SCE&G elects fixed price option for new nuclear units

CAYCE, SC –  SCANA Corporation (NYSE: SCG, the Company) subsidiary South Carolina Electric & Gas Company (SCE&G), filed a petition with the Public Service Commission of South Carolina (SCPSC) seeking approval to update the capital cost schedule as well as the construction milestone schedule for V.C. Summer Units 2 and 3, the two Westinghouse AP1000 nuclear plants being constructed at the V.C. Summer Station in Jenkinsville, S.C. (Project). Within this petition, SCE&G has informed the SCPSC that it has notified Westinghouse that it will elect the Fixed Price Option under the October 2015 Amended Engineering, Procurement, and Construction (EPC) Contract, subject to formal concurrence by Santee Cooper and the approval of the SCPSC. Once this exclusive and irrevocable option becomes effective, it will amend the EPC Contract to fix, as of June 30, 2015, substantially all of the costs to be paid for the remaining scope of the Project.

The construction schedule reflected in the petition indicates a guaranteed substantial completion date for Unit 2 of August 2019 and a guaranteed substantial completion date for Unit 3 of August 2020. These dates were established by Westinghouse in the October 2015 Amended EPC Contract. Subsequent to the signing of this Amended EPC Contract, Westinghouse hired Fluor as the subcontracted construction manager for the project. This petition reflects an increase in SCE&G’s total Project costs of approximately $852 million (a reconciliation of these additional costs can be found below) over the $6.827 billion approved by the SCPSC in Order No. 2015-661. This increase includes approximately $505 million that is directly related to the fixed price option. The total project cost is now estimated at approximately $7.679 billion including owner’s cost, transmission, escalation and allowance for funds used during construction.

“Construction of the two new nuclear units continues to progress,” said SCANA Chairman and CEO Kevin Marsh. “Fluor has proven to be an asset to the Project team and the vast majority of the major components and equipment have been received onsite. Completing these plants is imperative to bring clean, safe, and reliable electricity to meet the long-term energy needs of South Carolina. The Fixed Price Option provides substantial value to our customers, investors, and the Company by limiting the risk of future cost increases.”

Based upon today’s filing, and statutory requirements, SCE&G anticipates receiving an order no later than November 28, 2016. The interim dates for parties’ testimony and the hearing on the petition will be established by the Commission. The petition will be available on the Company’s website, www.scana.com, as well as the SCPSC’s website.

SCANA Corporation, headquartered in Cayce, S.C., is an energy-based holding company principally engaged, through subsidiaries, in electric and natural gas utility operations and other energy-related businesses. The Company serves approximately 702,000 electric customers in South Carolina and approximately 1.3 million natural gas customers in South Carolina, North Carolina and Georgia. Information about SCANA and its businesses is available on the Company’s website at www.scana.com.