A sale of Santee Cooper might be closer to a reality, and so may be a way out of the $9 billion of debt Santee Cooper customers would have to pay.
The marketplace is working. “A strong market for sale exists,” said the report commissioned by the South Carolina Public Service Authority Evaluation Committee of February 1. Here’s the link.
“The four full purchase proposals had prices at or above the full costs of providing for debt defeasance.” The debt of Santee Cooper is held by its customers, so this is positive news, too. Prices for Santee Cooper are within the value range the consultant had put on Santee Cooper. A value of Santee Cooper assessed by the consultant. All good.
The consultant put together a point system for the various criteria for purchase candidates. The consultant process is good because it gets a lot of the buyers’ cards on the table. Expressions of interest [EOI] were sent to the consultant hired by the SC General Assembly to receive and evaluate the EOIs. There are no actual commitments to buy at this point.
What about rates? The EOIs for full purchase all anticipated lower rates for Santee Coopers customers.
Recall that Governor McMaster asked for the General Assembly to use care about a sale of Santee Cooper, and move ahead efficiently. So now the clock is ticking and the State of South Carolina has decisions to make.
The potential buyers are high quality, too. The report said: “The four Participants are all qualified, capable potential buyers. Were the State of South Carolina to negotiate with these entities, it would find four counterparties with the financial, technical, and managerial capability to purchase Santee Cooper and provide reliable, safe, and economic electric and water services .”
The committee next meets Wednesday, February 6, to discuss the consultant report.
The report puts a lot of information in one place and did it in a pretty short time, really. As ECC reads it, the report provides a solid base for a sale of the Santee Cooper utility. There are multiple strong candidates.
Now the clock starts ticking for the State of South Carolina. Each day of delay is another million dollars of debt for consumers. There is $9 million of debt and, says the report, “A strong market for sale exists.” Tick, tick, tick … $, $, $.