CPS Energy Receives New Toshiba Cost Estimate for STP Expansion
San Antonio’s CPS Energy said on Monday it had received the contractually mandated cost estimate for the proposed South Texas Project Units 3 and 4 from contractor Toshiba—but it stressed it would make no decisions on the project until “rigorous analysis” of price and methodology was completed.
The municipality-owned utility said it would take several days to analyze the methodology behind the numbers and perform the necessary due diligence.
“We are well aware of the confidentiality provision contained in our contract with Toshiba and NINA (Nuclear Innovation North America, a limited liability company comprised of Toshiba and NRG Energy),” said Jelynne LeBlanc-Burley, CPS Energy’s acting general manager.
“If the cost estimate is disclosed prematurely, it places our customers at risk. Our staff will evaluate the information from Toshiba, put it into context and brief our Board of Trustees as soon as possible. In turn, we will properly notify other key stakeholders including the San Antonio City Council.”
The development is the latest in a sour dispute between CPS Energy and its 50-50 partner in the STP expansion, NINA. Last fall, Toshiba gave CPS Energy a substantially higher preliminary cost estimate to build Units 3 and 4 at the STP plant—reportedly $4 billion more than CPS Energy’s preliminary total project cost of $13 billion.
In early December, the utility filed a petition with a Bexar County court to define the liability both parties faced if they pulled out of the project near Bay City, Texas. CPS Energy said in its filing it had invested nearly $300 million in the project’s engineering and planning—even though a permit to build and operate the reactors won’t be granted until 2012. The “value of participation and related rights in and improvement to the project site” are worth more than $2 billion, CPS said.
The lawsuit escalated just before Christmas Day when NRG Energy sued CPS Energy, claiming the utility should forfeit its $300 million investment thus far and lose all value in the project. CPS then amended its filing, claiming NRG, NINA, and Toshiba failed to disclose critical cost information and disparaged CPS to hurt the utility’s ability to sell part of its stake in the nuclear project. CPS sought $32 billion in damages, according to court documents.
On Monday, CPS said it would continue in its legal proceedings against NINA and NRG Energy as it analyzed the latest cost estimate provided by Toshiba. A hearing has been set for Monday, Jan. 25, on the petition CPS Energy filed on Dec. 6 in state district court.
The STP nuclear expansion was reportedly one of four projects shortlisted for $18.5 billion in loan guarantees from the Department of Energy (DOE). The DOE had said on Dec. 17 it would issue the guarantees by the end of the year. But on Jan. 5, a DOE spokesman told the theenergycollective.com that the agency was “still crossing t’s and dotting i’s.”
Sources: CPS Energy, POWERnews, theenergycollective.com