Two views on why Duke didn’t blow $9 billion on a nuke plant
Why didn’t Duke Energy charge ahead with nuclear plant construction, investing $500 million in project preparation, while its peers in South Carolina put up $9 billion for a now-suspended project?
We asked Duke spokesman Rick Rhodes, who said Duke didn’t see an immediate need for the project given its other options. “Our need for baseload like the power that [the new plant] would provide is not immediate.” He added that Duke remains very supportive of nuclear energy as a low-cost source of power.
We also posed the question to persistent Duke Energy critic Jim Warren, who heads Durham-based nonprofit N.C. WARN.
Here’s his e-mail response:
Probably the only reason Duke wasn’t as deep is that they didn’t get full ‘”Construction Work in Progress, or CWIP’ [accounting treatment] in North Carolina. That would have given them the ability to force customers to ‘pay as you go’ as occurred at the Summer plant in South Carolina. North Carolina’s 2007 law allowed partial CWIP that allowed Duke to charge customers in advance – but only via a full rate case. Both former CEO Jim Rogers and current CEO Lynn Good openly insisted they would not go forward without the additional provision allowing them a virtually automatic annual pass-through of expenses, which is also called ‘tracking CWIP’. South Carolina, Georgia, Florida all got full CWIP – sold out by their politicians — despite it being super controversial .
The Fukushima incident in Japan also slowed Duke down in seeking full CWIP in N.C. Not too long later, both Summer and Georgia’s Vogtle plants had run into major problems.