Dive Brief:
- State lawmakers are considering a bill to temporarily block South Carolina Electric & Gas from charging for the failed VC Summer nuclear development. However, while the law would immediately reduce customer bills by a significant amount, it might also scuttle a proposed merger with Dominon, which offers significant customer benefits.
- Dominion has launched a campaign to lobby lawmakers and build public support. Its offer includes a $1,000 cash payment to customers and a 5% rate reduction.
- Dominion and SCE&G's lobbying efforts have drawn the attention of the state's Office of Regulatory Staff, which has issued a lengthy list of questions in the merger proceeding before state regulators.
Dive Insight:
The financial disaster of SCE&G's investment in the VC Summer nuclear expansion is now being dealt with on two separate tracks, but a collision may happen anyway.
At the Public Service Commission, Dominion and SCE&G are pressing for a quick decision on their merger. In the State House, they are lobbying to delay a bill that would temporarily forbid SCE&G from recovering its nuclear investment from customers.
The utility is currently billing customers up to $27/month for the project, according to The State newspaper.
Dominion Chairman, President and CEO Thomas Farrell II made the case for the merger in an op-ed published by The Post & Courier. He laid out the situation lawmakers and regulators face, arguing that $12.2 billion in customer benefits is a lot to pass up on. In addition to the large customer refund and moderate rate decrease, Dominion will absorb $1.7 billion in nuclear costs.
"It is the bird in the hand that is better than two 'maybe' birds in the bush," Farrell said. "It provides substantial customer benefits up front and over the long term."
But last month, lawmakers in the South Carolina House of Representatives overwhelmingly voted to halt SCE&G from recovering the nuclear costs. And a Senate panel approved the measure this week, sending it to the full chamber for a vote.
"We know our plan is not perfect," Farrell wrote in his opinion piece. "It substantially reduces but does not eliminate what customers would pay in new nuclear costs." But he also said approving the merger would eliminate costly litigation related to the nuclear development, ensure current customers are repaid, and partners the state with a parent company that can drive investment in renewables.
The state's ratepayer advocate has taken an interest in how much this full court press is costing. ORS has posed 176 questions to the companies on topics from profit margins to whether lobbyists played golf . Among the questions, ORS asks for a statement describing Dominon and SCE&G's national and state lobbying expenses.
SCANA Corp,. SCE&G's parent company, decided last year to abandon construction of the nuclear expansion last year after sinking $9 billion in ratepayer funds into the project.
