Lawmakers want certainty on rates if Santee Cooper is sold
COLUMBIA, S.C. (AP) — Several lawmakers on a special panel considering whether South Carolina should sell its state-owned utility told a consultant Wednesday they need as many details as possible on the 15 bids.
The proposals are all confidential as consultant ICF helps the state sort through deals to turn Santee Cooper over to private ownership.
The utility was created during the Great Depression to bring power and therefore business to South Carolina’s disadvantaged Lowcountry. But the utility is now $8 billion in debt, much of it from a minority partnership in two nuclear plants that were abandoned without generating a watt of power in 2017 after a decade worth of design and construction.
A special committee that includes senators, members of the House and Gov. Henry McMaster listened to ICF’s review of its 40-page report . It contained some pleasant surprises. Three of the bids promised to eliminate all Santee Cooper’s debt and keep utility rates from increasing at the same rate projected if the utility was not sold.
“That was not necessarily an expected outcome,” ICF Executive Director Judah Rose said.
ICF told the bidders they would keep details confidential even from the lawmakers to ensure fairness. Several lawmakers asked for more details, saying they were worried that the lower rates would never come true because problems might arise like having to pay to improve transmission lines or build new plants.
Sen. Larry Grooms, a Republican whose district includes Santee Cooper’s Moncks Corner headquarters, spent more than 20 minutes questioning Rose, asking him about whether South Carolina’s power transmission system, which handles the lowest voltage rates in the county, could import power from other states and how a private firm that has to pay taxes and other expenses could provide electricity cheaper than a publicly owned utility. Grooms has also worried that a number of Santee Cooper’s 1,400 employees might lose their jobs or the utility’s pensions wouldn’t be protected.
“I want to make sure we have certainty,” said Grooms, who has given several indications he isn’t ready to sell Santee Cooper.
South Carolina’s governor has called for selling Santee Cooper for over a year to make sure taxpayers aren’t saddled with its debt. McMaster waited nearly an hour before getting to ask his questions and honed in on Grooms’ comments about certainty.
McMaster asked ICF if it was fairly certain rates would keep rising if the state did nothing. After Rose agreed, McMaster, a former prosecutor, reverted to his courtroom mode.
“That’s about the most certain thing you can tell us, is it not?” McMaster said.
Committee co-chairman Paul Campbell said he expects it will be the summer before the committee decides if a sale is appropriate and then there will be months of negotiations before a final offer can be made to the General Assembly. The entire Legislature would have to approve the sale.
“What’s the best bid right now?” the Republican from Charleston said. “I can’t tell you.”
Any sale of Santee Cooper would reverberate throughout South Carolina. The South Carolina Electric Cooperatives buy 60 percent of Santee Cooper’s power to provide electricity to 1.5 million people over 70 percent of mostly rural areas the state.
The co-ops can end their contract if they don’t like the sale terms.
Santee Cooper’s majority partner in the failed nuclear plants, privately-owned South Carolina Electric & Gas, was sold to Virginia’s Dominion Energy in the fallout from the nuclear debacle.