With TEPCO as a Potential Co-Owner, South Texas Project Companies Delay Work on New Reactors

Partners in an effort to build two new reactors near Houston have put the brakes on the project following accidents at Tokyo Electric Power Co.’s Fukushima Daiichi nuclear plant.

TEPCO last year promised to invest $155 million in South Texas Project units 3 and 4, conditioned upon the reactors receiving a Department of Energy loan guarantee. That included a $30 million option payment that would allow the company to buy roughly another 10 percent of the project. Nuclear Innovation North America, jointly owned by NRG Energy and Toshiba, would hold an 83 percent stake in the reactors after Tepco’s initial investment. CPS Energy owns a 7.6 percent share in the project.

If the option were exercised, TEPCO would own a roughly 18 percent stake in the new reactors.

On Monday, though, NINA indicated it would stop most work on the plant following a string of accidents at six of TEPCO’s Japanese reactors following the March 11 earthquake and tsunami.

“Our best course of action in this immediate period of uncertainty is to minimize project spend, continue with those activities we can control and wait until there is more information upon which we can base our long-term decisions. This is the financially disciplined course of action in uncertain and challenging times,” said NINA chairman and NRG Energy CEO David Crane in a release.

Development of the project will now be limited to work related to licensing and obtaining the loan guarantees.

The release did not indicate the status of TEPCO’s involvement in the project and said NRG, Toshiba and NINA cut back on work to allow the Nuclear Regulatory Commission and others time to assess the events in Japan.

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