Where were South Carolina’s utility regulators?

Where were South Carolina’s utility regulators?
August 29 19:33 2017 Print This Article

South Carolina’s legislative leaders have howled with righteous indignation over the failed nuclear reactor project involving the South Carolina Electric and Gas Company (SCE&G) and the state-owned utility Santee-Cooper. What they don’t tell you is that they appoint the members of the Public Utility Review Committee (PURC) which oversees the state utility regulatory agencies. The PURC, selected by the Speaker of the House and the Senate Judiciary Committee Chair, picks and evaluates the Office of Regulatory Staff (ORS) and the Public Service Commission (PSC).

ORS has a mission statement “to represent the public interest in utility regulation by balancing the concerns of the using and consuming public, the financial integrity of public utilities, and the economic development of South Carolina.” The agency is responsible for inspecting, auditing and examining the utility companies. It failed to expose that SCE&G and Santee-Cooper never had an integrated construction schedule, an industry standard which tracks materials, workforce needs and budgeting, during the failed 9-year project.

The PSC, which receives technical feedback from the ORS during rate-increase hearings requested by utilities, passed 9 rate increases since the project began in 2008. The seven members of the PSC all receive six-figure salaries and represent each of South Carolina’s Congressional Districts. Representative Chip Limehouse (R-Charleston), who retired in 2016 after 22 years in the House, describes PSC as a rubber stamp for the utility companies.

The failed nuclear reactor project in Fairfield County (20 miles north of Columbia) was made possible in 2007 with the passage of the Base Load Review Act (BLRA). It allowed the for-profit utilities like SCE&G to start billing rate-payers during the construction phase of a new power plant. Before the passage of the BLRA, rate-payers couldn’t be charged for construction projects until the generation stations were on-line. SCE&G customers have already paid $1.4 Billion for the abandoned nuclear reactor project and may be on the hook for billions more in accumulated debt.

Limehouse and Sen. Chip Campsen (R-Charleston) were among the few legislators who opposed the BLRA. The measure passed the House by a 104-6 margin and the Senate by a nearly unanimous voice vote. Campsen subscribed the lobbying effort by SCE&G in the General Assembly as “like the plague of locusts in Exodus 10.” The utilities send campaign checks to most members of both parties. First-year Representative Micah Caskey (R-West Columbia) sent his $1750 in SCE&G contributions to a Salvation Army fund which helps low-income families pay their electric bills: https://www.facebook.com/votemicahcaskey/videos/785905114948218/?hc_ref=ARSM1il0l85I2tlZMDALD_SLYTXP9TCsn2_kvkTM4pUVuF9W0zO-k_CGEn_oi1uBFos&pnref=story

Speaker Jay Lucas (R-Darlington) and Senate President Hugh Leatherman both appointed committees to investigate the utility fiasco. They need to recommend the repeal of the BLRA and changing the regulatory structure to hold utilities accountable to the public. A more sweeping reform which should be considered is allowing consumers to choose their electric utility. Since it can’t be determined which company generates the electrical power consumers receive, they should not be granted monopoly status. Currently, 29 states offer some form of consumer choice for utility customers.