The mess in South Carolina over the failed V.C. Summer nuclear plant just gets more convoluted and complicated, week-by-week.
Last week, the South Carolina House of Representatives voted 108-1 to purge the South Carolina Public Service Commission. At the same time, the state Senate voted unanimously, 35-0, to give the PSC until the end of this year to review the $14 billion bid by Virginia based Dominion for SCANA Corp., parent of South Carolina Electric & Gas, the owner of the failed two-unit, 2,000-MW nuclear plant.
The Charleston Post and Courier, which has done an excellent job of covering the Carolina fiasco, said, “During a frantic day in the capital, South Carolina lawmakers and the state’s utility regulators set the table for what is now expected to be a year-long battle over SCANA’s handling of the failed V.C. Summer nuclear project.”
At the same time the legislature was expressing its ire – and confusion – over the Summer end game, the Associated Press reported that Florida-based NextEra Energy has floated the idea that it would be interested in buying state-owned Santee Cooper, 48% owner of the nuclear carcass, for “nearly $16 billion.” The AP account said, “Myrtle Beach Sen. Luke Rankin and Bonneau Sen. Larry Grooms said they have been briefed on the NextEra proposal.”
SCANA and Santee Cooper stopped construction of the plant last July, with $9 billion already spent on the project. The price tag at that point had risen to about $25 billion from an original $12 billion estimate.
Dominion says its offer to buy SCANA is contingent on keeping the notorious 2007 state law that permits the owner to recover the sunk costs as construction was underway. That law, the Base Load Review Act, has raised consumer rates by about 18%. SCANA has collected some $2 billion under the law and Dominion says it wants to recover the rest from SCANA’s captive customers over the next 20 years.
Dominion has said SCANA will have to seek bankruptcy protection if its deal falls through. Many observers have viewed that claim as a scare tactic. The PSC voted unanimously last week to give its Office of Regulatory Staff, the commission’s watchdog, time to hire an independent accounting firm to review SCANA’s books and the bankruptcy claim.
The state regulatory commission consists of commissioners from seven geographic districts, appointed on a non-partisan basis by the South Carolina general assembly to staggered six-year terms. The House-passed legislation would replace three commissioners this summer with the remaining four knocked off next year, the Post and Courier reported. The law would also reduce commission terms to four years. The newspaper reported last year that utility lobbying groups “picked up the tab for nearly $140,000 in conference expenses, meals and other perks” for the commissioners in the past five years.
Both the House legislation and the Senate bill to review the Dominion deal for a year require approval by the other chamber.
Veteran state utility regulator Karl Rabago, executive director of the Pace Energy and Climate Center, at the Pace Law School in White Plains, N.Y., tweeted, “South Carolina: You do understand that big utilities want to buy SCANA for the ratepayer revenues they plan to leverage into their out-of-state competitive biz, right? Unless you get great deal and solid commitments, you are selling the house and keeping the mortgage.”
— Kennedy Maize