Virginia-based Dominion Energy offered to buy the embattled SCANA Corp. on Wednesday, days before lawmakers are set to meet in Columbia to discuss a series of pre-filed bills relating to the South Carolina utility’s abandonment of the construction of two nuclear reactors last summer.
The construction was a partnership between SCANA and state-owned utility Santee Cooper that ended up costing at least $9 billion, before delays and mismanagement sent the utilities packing. SCE&G is a subsidiary of SCANA.
Dominion has also pledged $1.3 billion in refunds to SCE&G’s South Carolina customers as part of the buy, according to reports from both The Post & Courier and The State.
The typical home in South Carolina pays about $27 a month for the failed project, which will never produce any electricity for its customers.
Dominion is also offering a five percent rate reduction, averaging to $7 in savings per bill, and $1.7 billion to pay down the total debt incurred by the abandonment of the construction of the two nuclear reactors at the V.C. Summer plant in Jenkinsville.
While the deal might sound sweet — especially when you consider that the average refund would be about $1,000 per account — it relies on letting Dominion keep charging customers for the failed project.
The chief executive of Dominion Energy called the Base Load Review Act, the law that allowed SCE&G to begin charging customers for the reactors as they were built, “very important” to the purchase.
At least 14 bills have been filed in the state House of Representatives to either curb the influence of utility lobbyists, tighten restrictions on the Public Service Commission, or to make it harder for utilities to charge ratepayers for failed projects.
“The premise is, we protect the ratepayer. … I don’t see anything changing. That tone will continue,” said House Majority Leader Gary Simrill (R-Rock Hill) in an interview with P&C. “I don’t see the General Assembly being held hostage to anything other than protecting the ratepayer in South Carolina.”
House bill 4376 would ensure that “no new rates or revised charges may be imposed or approved for the purpose of paying any of the abandonment costs of the two nuclear reactors…”
The proposed Public Utility Consumer Protection Act, (H.4425), would give utilities “the burden of proving, by clear and convincing evidence, the timeliness of its decision to abandon the plant or project.”
The text of the Base Load Review Act, passed in 2007, already places the burden on the utility to prove by “a preponderance of evidence” that any decision to abandon a plant and adjust rates accordingly is “prudent.”
In the fall, the state began the process of selling Santee Cooper, the state-owned utility that carries a minority stake in the failed nuclear reactor project.
“The only way to resolve this travesty is to sell Santee Cooper,” said Gov. Henry McMaster in a statement after the offer went public. “There is more work to be done, but today, we are headed in the right direction.”
The Dominion-SCANA acquisition announcement this week is merely a proposal, the actual sale would have to clear multiple state and federal hurdles.
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