Dive Brief:

  • South Carolina regulators on Monday concluded SCANA executives acted “imprudently” by deliberately misleading the Public Service Commission (PSC), the Office of Regulatory Staff (ORS), the public and investors about the financial condition of the V.C. Summer nuclear project.
  • The vote came as the PSC rejected appeals to their December decision, allowing Dominion Energy to acquire SCANA and its subsidiary, South Carolina Electric & Gas (SCE&G). The new finding will not impact the acquisition or a planned rate decrease, but could signal greater scrutiny down the line.
  • Dominion stepped in to acquire SCANA as controversy swirled over who would pay for the failed V.C. Summer project, which went billions over budget and was scrapped in 2017. Now, regulators say the company intentionally kept them in the dark

Dive Insight:

The PSC had previously declined to make a finding of imprudence, but local media reported pressure from state House Speaker Jay Lucas, R, may have played a role in the “surprising reversal.”

Earlier this month Lucas filed comments with the PSC, arguing “the record in this case is replete with evidence that supports the Commission making a finding of imprudence.”

The Securities and Exchange Commission in 2017 launched an investigation, following allegations in a shareholder class action lawsuit that SCANA executives made “false and misleading statements” on the Summer project. A 2015 analysis of the project by construction giant Bechtel concluded the project timeline was too ambitious and costs were skyrocketing, but those warnings were removed from the final version presented to state officials.

Lucas’ office did not respond to requests for comment on the PSC’s decision, but his filing with the commission was made in support of a petition by ORS for a specific ruling on SCE&G’s imprudence.

ORS Executive Director Nanette Edwards issued a statement applauding the decision, which concluded SCANA executives acted imprudently beginning March 12, 2015.

“We believe it is of vital importance that a legal finding of imprudence on the part of the utility be issued not just to satisfy the law but to send a message to all utilities regulated by the PSC that statutory compliance, transparency and accountability are requirements that cannot be violated without penalty,” Edwards said.

A spokesman for ORS said there would be “no discernable impact,” from the PSC’s decision, calling it “just a legal requirement that was oddly not met previously.”