Since Virginia-based power company Dominion Energy announced its plans to buy Cayce-based SCANA in January, a torrent of advertising has descended on South Carolina’s radio, TV, and print touting the benefits of the merger for customers and the state.
South Carolinians can’t be faulted for wanting a way out of SCANA, the parent company of SCE&G, and its battered reputation following the the beginning of the nuclear debacle in July. SCE&G’s roughly 700,000 customers pay 18 percent of their monthly bills — or about $27 for the average customer — for two nuclear reactors in Fairfield County that will never generate any power.
SCE&G was the majority owner of the project it shared with public utility Santee Cooper.
You see, the $9 billion project shouldered by ratepayers from the very beginning thanks to this thing called the Base Load Review Act. The law, passed in 2007 without then-Gov. Mark Sanford’s signature, allows energy companies to charge ratepayers for nuclear plants during their construction rather than after.
But after seeing the fruits of the legislation, Gov. Henry McMaster says he wants the law repealed. And he’s been lining up potential buyers for SCANA.
Among the most enticing offers, Dominion is offering to refund SCE&G customers $1,000 within the first 90 days after closing the all-stock merger. That may sound sunny, but it all hinges on keeping you on the hook for the abandoned project.
Before this year’s legislative session ended last week, the S.C. House of Representatives approved an 18 percent rate cut — the full amount SCE&G customers are paying each month for the failed reactors. The S.C. Senate approved a 13 percent cut, though no deal was reached between both houses.
Dominion’s proposal still needs to clear various regulatory hurdles, including approval by the Federal Trade Commission, the Department of Justice, and South Carolina’s Public Service Commission, which will decide whether the merger can go through and how much ratepayers are charged for reactors.
State lawmakers have already expressed concern with Dominion’s advertising tactics. So keep the following things in mind as you field the barrage of sunny, quasi-inspirational ads promising a future that is “brighter together.”
- That $1,000 refund may consist of money ratepayers were already entitled to.
According to The Post & Courier, SCE&G signed a $1.2 billion settlement with Toshiba, the contractor responsible for building the two nuclear reactors. SCE&G promised to pass on those gains to consumers. The terms of Dominion’s offer even say the refund checks are intended to fulfill the promise. Even then, Dominion’s proposed $1,000 refund check would only make good for about 75 percent of the money the average SCE&G customer has already paid into the failed reactors.
- The proposed merger still hinges on you — the ratepayer — continuing to pay for the scuttled nuclear Fairfield County nuclear reactors for the next 20 years.
According to Dominion’s proposal, SCE&G ratepayers will continue to pay for the failed reactors for the next 20 years. The percentage of payments going to the useless reactors will phase out slowly, finally ending at a little less than 6 percent of a customer’s bill. That’s still about $2.2 billion over the next two decades for two reactors that will never produce any power for anyone.
- Dominion has threatened to pull the merger if lawmakers make it so the power company can’t keep charging you for the failed reactors.
Dominion has repeatedly threatened to pull the deal if lawmakers either cut SCE&G customers’ rates or do what Gov. McMaster and many consumer advocates have been hoping for: repeal the Base Load Review Act and stop utilities from charging for unbuilt work. “A rollback of the Base Load Review Act would be a real problem for us,” said Dominion spokesperson Chet Wade, according to the Aiken Standard. “Our problem is if they want to make the repeal retroactive.”