Headlines over the past year or so in South Carolina reflect the controversy in the energy industry. Not just controversy, really. Confusion, too. Trying to track the events is perhaps another way to define the term March Madness, just not the basketball variety. The confusion, action and lack of action can drive people mad.
This is a short blog just to put some facts in one place as we have understood them. ECC has seen comments about Santee Cooper prompting comments about the Scana/Dominion merger. Sometimes the comments appear to mix the two. High emotions can create confusion. When big issues have to be decided, facts need to be understood. Perhaps this can help.
The merger of Scana (parent company of SCE&G) with Dominion is done. Post-merger work takes time as two corporate systems are meshed and people are put in new places. They will officially operate under one name in April. There is already a name change evident to consumers. It is Dominion Energy now. Behind the scenes in a merger there have to be reconciliations of IT systems, human resource items, communications and so on. For all purposes, Dominion looks like it is running its playbook for the merger.
Both SCE&G (Scana) and Santee Cooper were involved in the new-build of two units at the VC Summer facility north of Columbia. Both incurred costs on that. SCE&G’s costs are now the responsibility of Dominion to handle. Dominion customers are still paying for a portion of the nuclear project though there is no large, unchecked and growing debt load on them.
Santee Cooper’s part of the debt is still out there for customers to pay at this point. Deals on the table for Santee Cooper eliminate 100% of the debt in one transaction. Fast, too. A question: Will General Assembly players take action or stay on the bench?
There was back and forth on proposals from Dominion and state officials to move forward the Dominion and Scana merger. At one point Dominion suggested that it issue a $1,000 check for each average customers. That idea was spurned by elected officials in South Carolina, in favor of a lower electric rate for customers. News reports show that Dominion understood that preference from officials and came back with a different proposal (no $1,000 check) that was eventually accepted. Some examples ECC has seen of this past news:
- Post and Courier headline on October 25, 2018: “Dominion open to cutting monthly SCE&G electric rates more in lieu of $1,000 refund.”
- WLTX-TV on December 14, 2018: “Friday’s agreement also means there will now not be a $1,000 rebate to SCE&G customers that Dominion had proposed.”
- “’The rate is going to be lower going forward which is a good thing for everyone,’ said Bill Taylor, an Aiken Representative. … ‘Their initial offer of a $1,000 back in the form of a rebate was a bad deal, to begin with,'” said Taylor,” from WRDW-TV on January 2, 2019.
The once proposed $1,000 checks from Dominion do not have any relation to Santee Cooper.
Selling Santee Cooper
Santee Cooper cannot sell itself. Not its decision. The South Carolina government owns Santee Cooper. Legislation must be enacted to initiate a sale. A consultant hired by the General Assembly delivered a report – Evaluation of Responses to the Request for Expressions of Interest and Indicative Offers for Santee Cooper – to the special legislative committee tasked to evaluate a Santee Cooper change. Highly qualified organizations have an interest to purchase Santee Cooper and can handle the multi-billion dollar debt according to the report. The debt owed by Santee Cooper customers currently increases about $1,000,000 a day in interest by some reports.
Staying with the March Madness theme, the ball is in the General Assembly’s court.
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