“SCANA accountant: Utility execs pressured me to lie about SC nuclear project”

The State

COLUMBIA, S.C. — A SCANA accountant says the utility’s leaders pressured her to lie and altered information she gave to S.C. regulators about how much it would cost to finish the utility’s floundering V.C. Summer nuclear project, later abandoned.

The allegations are contained in a recently released, heavily redacted deposition given by former SCANA executive Carlette Walker, who oversaw spending at the nuclear construction site.

A SCANA spokesman declined to comment on the deposition Friday, and attorneys representing the utility did not return messages seeking comment.

Part of Walker’s job at SCANA was to provide sworn statements to state regulators justifying rate hikes that the utility’s electric subsidiary, SCE&G, requested and, ultimately, received to pay for building two new nuclear reactors at the V.C. Summer Nuclear Station.

Walker testified under oath in an April deposition. That deposition was taken as part of a civil suit in S.C. Circuit Court that seeks to force the utility to compensate customers for the $2 billion that they already have paid for failed project.

About 20 lawsuits have been filed in state and federal courts challenging SCANA over its decision to walk way from the project and keep charging its electric customers.

SCE&G’s more than 720,000 S.C. electric customers still are paying $27 a month, on average, to finance the half-finished, abandoned reactors, originally expected to cost $9 billion.

Walker — who resigned from SCANA in June 2016 and is a potential witness in an ongoing FBI fraud investigation into the nuclear debacle — said she quit “because I wasn’t going to lie.”

Asked by an attorney suing SCE&G who pressured her to lie, Walker responded with the names of former SCANA chief executive Kevin Marsh, former operations chief Steve Byrne and then-chief financial officer Jimmy Addison.

Marsh and Byrne stepped down from the utility last fall following the furor over the failed nuclear project. Subsequently, Addison became the utility’s chief executive.

Walker testified the estimated construction costs that she shared with Addison in 2015 were not the same as those provided in her 2015 testimony to the S.C. Public Service Commission, which regulates utilities.

Walker said her team’s estimate of how much it would cost the Fairfield County project’s contractor, Westinghouse, to finish the two nuclear reactors was altered as SCANA prepared for a hearing before the PSC to get approval for the project’s revised budget and construction schedule.

Attorneys Terry Richardson and Dan Haltiwanger, who are suing SCANA subsidiary SCE&G, claim the utility misled regulators and hid materials.

Walker said she tried to raise concerns about project delays and increasing costs but was “shut down.”

“I had shared my feelings with five of the senior executives,” Walker said.

Asked by Haltiwanger what communication he could request that would document the concerns she raised, Walker responded, “There wouldn’t be anything you could find.”

“Because no matter what I said or did, they would not put it on the agenda,” Walker said, adding she often heard, while employed at SCANA, “what happens at nuclear stays at nuclear.”

Walker also said she tried to warn the state-owned Santee Cooper utility, SCANA’s junior partner in the V.C. Summer expansion, to stop paying SCANA any more for the project’s escalating construction costs.

“I felt especially protective of the ratepayers, whether they were Santee Cooper or SCE&G’s,” Walker testified. “And I knew at that point I could not do anything to protect SCE&G’s ratepayers, but I knew (Santee Cooper nuclear manager) Marion (Cherry)“ and others had been pushing back against SCE&G’s management.

In a previously reported early-2016 voicemail, Walker ranted SCANA executives were mismanaging the nuclear construction project and “breaking every friggin’ law that you can break.”

That tape-recorded phone call was played last week before Circuit Court Judge John Hayes. In the call, Walker claims SCANA’s executives were propping up the failing project so they could meet profit goals and collect millions of dollars in bonuses.

It is not clear from the redacted deposition how much Walker estimated it would cost to finish the project or how that cost differed from the information that later was provided to state regulators.

About half of Walker’s deposition was redacted — blacked out — at the request of SCANA’s attorneys, who marked her remarks as confidential, said Matthew Richardson, an attorney representing the S.C. Office of Regulatory Staff. Regulatory Staff is the state agency that represents the interests of ratepayers in utility cases.

Regulatory Staff and the attorneys suing SCE&G have challenged SCANA’s insistence on secrecy and are awaiting a court ruling on whether they can disclose Walker’s redacted remarks.

“We don’t think any of it ought to be confidential. Just because it’s bad doesn’t mean it’s confidential,” Richardson said.

Asked what became of her team’s cost estimates, Walker suggested the attorneys ask Addison.

“I handed it to him,” Walker said. “Just ask him. Say, ‘Jackass, where’s the file Carlette gave you that was supposed to be used in the testimony in 2015?’ ”

Picture of Wyche, P.A.

Wyche, P.A.

Wyche is a full-service law firm that has practiced law and served the community for 100 years. In that time, Wyche has participated in landmark litigation, served as counsel on cutting-edge transactions, and provided community leadership that has helped shape and drive our region’s growth and success. With offices in Greenville, Spartanburg, and Columbia, Wyche is the South Carolina member of Lex Mundi, the world’s leading association of independent law firms.

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