SCANA Floats Gesture Of Reconciliation

Amidst an atmosphere of political heat and ratepayer angst associated with the cessation of work on the multi-billion dollar V.C. Summer expansion project, South Carolina Electric and Gas Company on Thursday proposed a multi-dimensional compensation package offering economic relief to ratepayers and proposing to add natural-gas fired power and solar panel investments to appease its constituency.

V.C. Summer The company said the package came to $4.8 billion in compensation to the region. This would include the addition of a 540-megawatt natural-gas-fired power plant to its system "replacing more than 40 percent of the projected power that was to be provided to SCE&G from the V.C. Summer nuclear construction project." The company's press statement said the gas-fired plant would be "an addition ... to SCE&G's system," and later added in parentheses "acquisition cost to be borne by SCANA shareholders," an indication that the company aimed to purchase, not build, the addition to its generation capacity.

The company also proposed a rollback of residential rates "to where they would have been in March 2015," which was calculated to save ratepayers approximately $90 million ... "or 3.5 percent (the monthly bill of a customer using 1,000 kilowatt hours of electricity would decrease more than $5)." 

Additionally, "SCANA's shareholders will absorb the net nuclear construction costs through lower earnings over 50 years," SCANA said. On top of that, the company said it would add 100 megawatts of large-scale solar energy to its generation capacity -- an approximate 50 percent increase in non-rooftop solar capacity. Similar to statements concerning the gas-fired power plant, the company did not say it would construct new solar installations. In this case, it also did not mention suggest a plan to purchase existing solar generation capacity.

This summer's announcement that state-owned utility Santee Cooper, the minority owner, and SCANA, the majority owner, would pull out of the massive expansion project before it was completed, it is safe to say, sent shock waves through the state, especially in the capital, where state politicians understood that the project represented thousands of long-term construction jobs and up to 1,000 or more permanent, well paying jobs associated with plant operations.

Chief executive officers at both SCANA and Santee Cooper -- respectively Kevin Marsh and Lonnie Carter -- have resigned in the wake of the fiasco. Marsh is expected to step down January 1.

"We've heard our customers' frustrations about paying for a power plant and having nothing to show for it. This proposal gives customers additional power generation while also lowering rates for customers," said Keller Kissam, who is slated to become the president and chief operating officer on 1 January 2018, as Marsh steps down.

"We hope interested parties will endorse the proposal so that we can obtain approval from the Public Service Commission and get this relief to customers," said Jimmy Addison, who is currently SCANA's Chief Financial Officer and will become its Chief Executive Officer Jan. 1.  "Current projections indicate that if this proposal is adopted, we would not need an additional generation source for several years. This is a key step to meeting South Carolina's robust economic growth." 

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