Toshiba Nuclear Woes Has Moody's Warning of Scana Credit RisksBy
U.S. utility owner Scana Corp. is facing increased credit and regulatory risks with Toshiba Corp.’s Westinghouse, the nuclear power-plant builder contracted to install two of its nuclear reactors, potentially restructuring, according to Moody’s Investors Service.
Moody’s lowered Scana’s outlook to “negative” because of the “uncertain future” of Westinghouse, which is building the two nuclear units at Scana’s V.C. Summer plant in South Carolina.
Toshiba is still reeling from an estimated $6.2 billion writedown associated with its nuclear division, and Westinghouse has hired an adviser to help restructure its business, people familiar with the situation said earlier this month. The company’s financial troubles have weighed on the shares of Scana, which said last month it could seek a new contractor to complete the reactors -- or even step in to do the work itself -- if Westinghouse were forced to drop out.
Toshiba’s situation raises questions about its “ability and willingness to physically complete the projects, which would ultimately shift some of the risks of nuclear construction, and the potential for future cost increases, back to” Scana’s South Carolina Electric & Gas Co. utility, Moody’s said Monday.
Moody’s lowered the outlook of Southern Co.’s Georgia Power utility to negative from stable, also citing Westinghouse. Westinghouse is contracted to build two reactors at the utility’s Vogtle plant in Georgia. Moody’s affirmed Southern’s own ratings with a stable outlook.
Southern and Scana didn’t immediately respond to requests for comment.