The bid to take over South Carolina’s battered state-owned electric generation and transmission public power system, Santee Cooper, gets “curiouser and curiouser”, to steal from Lewis Carroll’s Alice in Wonderland.
According to the always aggressive, sometimes snarky, statewide political news blog FITSNews (motto: “Unfair and Imbalanced”), Florida-based NextEra Energy’s CEO James Robo has made South Carolina Republican Gov. Henry McMaster, an $8 billion cash-on-the-barrel head offer for the troubled system, facing $8 billion in debt for its share of the failed V.C. Summer new nuclear project.
FITSNews reported that McMaster, who has long said he wants to sell Santee Cooper, was “stunned-speechless.” The blog reported: “‘You mean to tell me,’ McMaster eventually stammered, ‘that you can move eight billion dollars today? Without having to ask anybody?’ Robo nodded in the affirmative ….”
It’s a sweetheart deal for NextEra, “Because after all, if $8 billion winds up being NextEra’s final offer, that would be just enough to cover the utility’s $7.5 billion debt (and the roughly $400 million or so in fees for retiring it ahead of schedule).
“It would leave no money on the table – at least not at the moment – for Santee Cooper itself.”
It’s a deal that McMaster can’t accept on his own, as much as he might like, as the sale of the state’s enormous asset, the fourth largest public power system in the U.S., requires the state legislature to sign off. As widely reported, the State Senate is unlikely to agree to a sale.
Earlier, North Carolina’s Duke Energy, which already operates in the state, made an unspecified offer for the struggling public power system, with NextEra rumored to be ready to make a bid.
Adding to the ironies involved in the Santee Cooper pursuit, FITSNews reports that a former SCANA Corp. top executive is in involved in a bid by private-sector Pacolet Milliken in a reported $10 billion offer. Greenville, S.C.-based, Pacolet Milliken, owned by the family of the Milliken textile conglomerate, owns Lockhart Power, a state regulated electric and water utility in five counties.
FITSNews reported, “A prominent member of Pacolet Milliken’s board of directors is William Timmerman, who served as the chairman and chief executive officer of SCANA.” The report notes that “upon his retirement in 2011 Timmerman hailed the project as a highlight of his career – boasting of the billions of dollars in savings South Carolina ratepayers would experience once the new nuclear reactors came online.”
The two-unit, 2200-MW project collapsed in July 2017, after both SCANA and Santee Cooper had passed on construction costs to customers in a series of rate hikes and a “$10 billion hole in the ground, spawning ratepayer lawsuits, political intrigue, criminal investigations and a furious debate over how to resolve the unprecedented …economic disaster….”
— Kennedy Maize
Ten billion here, ten billion there. Who cares, so long as the ratepayers are still holding the bag?