The CEO of South Carolina's state-owned utility is retiring, making him the first executive to leave following last month's failure of a nuclear power project that customers have been funding since 2009.
The board of Santee Cooper announced Lonnie Carter's resignation Friday. Carter, CEO since 2004, has worked for the utility since graduating from The Citadel 35 years ago.
Board members wanted Carter, who has been eligible for retirement for years, to remain until the project's completion, and the CEO told them last week it was time for him to retire. No other executives are expected to leave, Chairman Leighton Lord said.
Carter, 58, will stay in his job for the next several weeks, until the board names an interim replacement. A permanent replacement will likely be named by next summer, Lord said.
Carter pledges to participate in any legislative hearings into why the public utility and privately owned South Carolina Electric & Gas decided July 31 to bail on the expansion of V.C. Summer Nuclear Station after jointly spending nearly $10 billion.
The abrupt end left about 6,000 people jobless and brought a backlash from lawmakers and customers, who have spent about $2 billion on the project through rate hikes. Santee Cooper's customers paid more than half a billion of that.
Legislative panels created to investigate the debacle started meeting Tuesday.
The board unanimously approved a resolution praising Carter's service and extending its "genuine and heartfelt best wishes."
"Santee Cooper has profited immensely from the strong leadership and wisdom exhibited by this outstanding businessman and public servant during his tenure, and will continue to benefit in multiple ways in the years to come from his foresight," reads the resolution.
Carter and executives for SCANA, SCE&G's parent company, have repeatedly blamed lead contractor Westinghouse for the project's failure. Westinghouse declared bankruptcy in March, voiding fixed-price contracts negotiated in 2015 to control escalating costs. Utility executives contend they were forced to give up after a post-bankruptcy-analysis since determined the price tag for completing the project — budgeted at $11 billion in 2008 and last approved by state regulators at $14 billion — had actually soared beyond $20 billion.
Testimony revealed the project never had a detailed construction schedule. State regulators approved the expansion in 2008 with a "generic" schedule even SCE&G discounted as not specific to the site. Utility executives said they tried unsuccessfully for years to get a full schedule from Westinghouse.
Instead, they got a "six-month look-ahead schedule," Carter said. "They'd stray off of them in four to six weeks and have to reschedule."
Carter told senators his utility first "raised concerns" about the project in 2013, ultimately causing the board to hire Bechtel for an independent analysis of the project's status. Senators voted to subpoena that 2015 report. Santee Cooper wants to provide it, Lord said.
Senators indicated they were tired of the finger-pointing.
"We can sit here and blame Westinghouse all day. We can blame a partner or two on this, but at some point, y'all, we can't pass the buck anymore," said Senate Majority Leader Shane Massey, R-Edgefield. "There's got to be some responsibility for both Santee Cooper and SCANA on this."
Massey warned against allowing executives to go under confidentiality agreements that prevent them from being grilled by legislators.
"Please don't do that to us, because then we're going to get into a bigger fight on subpoenaing people to come in," he said Tuesday.
Santee Cooper, the state's largest utility, is the source of electricity for about 2 million people across South Carolina. It directly sells power to nearly 177,000 customers in Berkeley, Georgetown and Horry counties, as well as 26 large industrial customers, including Joint Base Charleston. It also provides electricity to the state's 20 electric cooperatives and a dozen municipal utilities.
