The Other Billion Dollar Power Company Crisis SC Lawmakers Are Avoiding

Featured Image Source: Tim Dominick, The State

Santee Cooper, South Carolina’s state-owned electric utility which serves over 2 million South Carolinians, is facing mounds of criticism and a push from many to sell.

Why?

With sentiment surrounding the state-owned electric utility such as “Letter to the Editor: Sell Santee Cooper” and “Santee Cooper hammers final nail into coffin of unfinished VC Summer nuclear project”, it’s no surprise that people are pushing for the sale.

Bluntly, some say the state has failed at running Santee Cooper and piled up an increasing amount of debt reaching a nearly nine billion dollars.

Half of this debt comes from the failed nuclear reactor which was put on pause back in 2017, followed by an unsuccessful year-long search by Santee Cooper to find another utility to finish the project. As reported by The State, no company was interested in buying and finishing the V.C. Summer Project, meaning the reactor, costing billions of dollars, will never produce any results. Now, the burden of this debt falls onto the shoulders of Santee Cooper’s customers. This means increasing rates for all ratepayers for years to come.

Governor Henry McMaster recently addressed the increasing need to take action regarding Santee Cooper in his State of the State address, “Santee Cooper and SCANA’s decisions to suspend and abandon the construction of two nuclear reactors at the V.C. Summer Nuclear Station require us to take action immediately, but carefully.”

Gov. McMaster continued by noting that “Unlike SCANA, Santee Cooper has no stockholders to bear part or all of this debt.” He concluded his discussion on Santee Cooper by saying “The only feasible solution suggested so far is the sale of Santee Cooper.”

According to The State, the State Senate’s Majority Leader, Senator Shane Massey of Edgefield, said “It’s a big political lift. You’re going to have some folks that are going to defend Santee Cooper, no matter what they do. You’re going to have other people who are going to want to sell Santee Cooper, no matter how they perform.”

What’s being done to help South Carolinians?

A joint SC Senate and House panel was selected to oversee the potential sale of Santee Cooper. This panel then hired ICF International, a Virginia-based consulting firm, to review any bids received from possible buyers.

Bid submissions to purchase the utility were due by January 14, 2019, and while the number of bids are unknown, the Post and Courier reported several companies have confirmed their bids. As each of the proposals are reviewed, many of South Carolina’s residents hope the sale will relieve the state of billions of dollars in debt and streamline management.

What happens next?

ICF is expected to report to the Legislative special committee at which point the committee will review the ICF report and determine the future course of action.  The decision to sell or not must be made by the General Assembly. The General Assembly can take the next couple of months to act or call a special session.

While South Carolinians wait for a decision to be made the debt continues to grow, and as the clock ticks it seems the only plausible way to save Santee Cooper from itself is to sell to a utility that can absorb the debt and keep rates low.