AUTHOR: Gavin Bade@GavinBade PUBLISHED Feb. 16, 2018 Utility Dive
The South Carolina House of Representatives voted 108 to 1 on Thursday to fire all of the state’s utility regulators over the next two years due to their role in the V.C. Summer nuclear plant debacle.
The bill would remove and replace all sitting regulators on the state’s Public Service Commission by the end of 2019, as well as set new ethics requirements for regulators. It still must be taken up in the state Senate.
The bill’s passage comes a day the state Senate voted unanimously to give state regulators until December to resolve customer charges for the plant, putting in doubt an acquisition of South Carolina utility SCANA, one owner of Summer, by Virginia-based Dominion. SCANA’s partner, public utility Santee Cooper, is also reportedly attracting acquisition interest. The lawmaker plan to turn over the South Carolina PSC is the latest fallout from the cancellation of the V.C. Summer nuclear expansion last year.
In July, SCANA and Santee Cooper announced they would abandon construction of the plant, having already spent $9 billion in ratepayer cash. The plant was originally estimated to cost less than $12 billion, but mismanagement and problems with reactor design from contractor Westinghouse raised final cost estimates to $25 billion. SCANA now faces multiple lawsuits and an SEC investigation into whether it misled shareholders about the project. If approved, the House’s PSC replacement bill and the Senate’s proposal on customer charges could affect the utilities’ ability to recoup the costs already spent on the plant. SCANA currently plans to spread ratepayer payments for the plant over the next 60 years, but the Senate bill would allow regulators until Dec. 21 to decide if they will prevent the utility from recovering those costs. In that time, three utility regulators on the seven-person PSC would be replaced if the House bill became law.
The House bill would also set stricter ethics requirements and reduce the tenure of PSC officials from six years to four. Those provisions follow revelations from the Charleston Post & Courier that utility trade groups and other associations paid for nearly $140,000 in meals, travel and other perks for regulators in the past five years.
The bills could also threaten an acquisition offer for SCANA from Dominion Energy. The CEO of the Virginia-based utility has repeatedly said his company would walk away from the $14 billion deal if regulators take away cost recovery for Summer or if lawmakers retroactively repeal the Base Load Review Act, a 2007 law that allowed utilities to charge ratepayers for plants before they had been completed. House lawmakers voted to repeal the Act in January.
As that acquisition faces more challenges, a new one could be on the horizon. The Post & Courier reports that two utilities are in the hunt for Santee Cooper, the public utility that partnered with SCANA on the Summer plant, each seeking to pay about $10 billion each. Gov. Henry McMaster (R) had called for the utility to be sold off to help pay for the canceled plant.