Wunderlich Securities Comments on SCANA Corporation After NRC Found Technical Problems in Westinghouse's AP1000 Nucler Design

Wunderlich Securities commented on SCANA Corporation SCG after the Nuclear Regulatory Commission found technical issues in the Westinghouse's AP1000 nuclear design. In a research report published today, Wunderlich states, "On Friday, the Nuclear Regulatory Commission (NRC) issued a statement indicating Westinghouse must resolve some technical issues before the NRC can approve the AP1000 nuclear design. The NRC's official statement appears to support SCG's expectation as of last week that design certification may be delayed by a month or more. The outstanding issues do not appear to require a change to the AP1000 design, which we believe would make the difference between a minor vs. a more significant scheduling delay. We continue to believe a few months' delay should not materially impact SCG's COL or 2012 nuclear spending. SCANA's June 16 analyst meeting should prove timely given these developments." The AP1000 problems will have an effect on SCANA as well. The report states, "The NRC said it expects Westinghouse to submit additional information addressing these technical issues in early June, at which point the NRC Staff will review the information and determine what impact any revisions will have on the schedule for design certification approval and related nuclear license issuance for Southern Company (SO-NR) and SCANA Corp. In the meantime, NRC Staff will conduct a previously scheduled inspection of Westinghouse's quality assuance and corrective action programs next week." At the moment, Wunderlich has a Buy rating and a price target of $44 on SCANA. On Friday, SCANA lost 0.84% of its value to close the day at $41.49.