Those wise guys at South Carolina Electric & Gas ...
After state regulators last week had the temerity to suggest the obvious - that, duh, the utility shouldn't continue to charge ratepayers for its scuttled nuclear plants - the company's lawyers …
This item is available in full to subscribers
Click here to log in
If you're a print subscriber, but do not yet have an online account, click here to create one.
If you aren't yet a subscriber,
click here to start a new subscription.
You also have the option of purchasing 24 hours of website access, for just 99 cents. *
Click here to continue.
* Full access is available from time of purchase through 11:59pm the following day
After state regulators last week had the temerity to suggest the obvious - that, duh, the utility shouldn't continue to charge ratepayers for its scuttled nuclear plants - the company's lawyers basically threatened their own customers.
They called the Office of Regulatory Staff's recommendation "illegal and unconstitutional." Then they warned the Public Service Commission not to follow staff's advice, or else SCE&G wouldn't be able to continue providing power to its 718,000 customers.
In parlance, that means: "You keep paying for them abandoned nuke plants or we aren't so sure you're gonna have power. Capiche?"
Unfortunately for SCE&G and SCANA, its Midlands-based parent company, the Legislature is going to the mattresses.
Following a month of hearings, lawmakers believe the utility has lied to the public, the PSC and the General Assembly. And there will be consequences.
Senate Majority Leader Shane Massey, co-chair of one of the investigating committees, expects the Legislature to lay down the law when it reconvenes in January. Massey doesn't yet know what that will entail, but he's fairly sure SCE&G will balk.
"I suspect whatever that response is, they won't like it, and they'll sue," Massey says. "Then we'll find out if it's constitutional or not."
You have to hand it to SCE&G officials.
In the face of public outrage, a slew of lawsuits and the threat of legislative action, they still claim with a straight face that they have acted in the public's best interest.
And then they have the gall to make threats, which only makes lawmakers more determined.
Just a piece of advice: When you're in a hole this deep, stop digging. Or at least install some underground power lines while you're down there.
The bottom line is the utility has taken its customers for nearly $1.8 billion, at an average of $27 a month, to basically not build two nuclear power plants in South Carolina.
They abandoned those projects in July, laying off thousands of workers, after claiming the plants would cost more than twice the initial estimate. But, the company said, they still need customers to bail them out to the tune of $4 billion. Give or take.
The worst part is that SCANA knew this deal was going sour at least a year earlier and hid the report from the PSC and the Legislature.
Didn't want to hurt the stock prices, you know.
House members were livid when they found out this tidbit and called for a SLED investigation. Which is a good idea.
"This request perfectly illustrates the SCANA leadership's level of arrogance, dishonesty and selfishness," says state Rep. Leon Stavrinakis. "The state should not be in the business of rewarding bad behavior, and their behavior has been plenty bad."
He's right. In fact, after that call to SLED, someone should get on the phone to the Securities and Exchange Commission.
A coming sit-down
It's no surprise SCE&G went, well, nuclear over the regulators' recommendation.
That plant construction surcharge they've been extracting from ratepayers brings in about $37 million a month. Which is a lot of money.
Why, it's $16 million more than the bonuses the executives in charge of this boondoggle have taken home in that time.
Now the company worries the loss of that surchage will bankrupt them, or at least shrink stockholder dividends. Well, too bad. Nobody feels real sorry for the company because there's no excuse here.
SCE&G holds a monopoly. It's like a license to print money. There is some responsibility that goes along with that privilege.
It's why the Public Service Commission has the authority to set their rates.
And for the past decade, the PSC has allowed the utility to raise those rates two or three times a year. In other words, 718,000 households in South Carolina have been shaken down for a decade while this gang raked in record profits ... and squandered it.
And now, it's over.
Utility officials can toss around terms like "illegal" and "unconstitutional" all they want, but they should be careful. The state Attorney General's Office has already questioned the constitutionality of their sweetheart deal.
So, SCE&G officials should be careful about running to the courts. There's a good chance they will lose. After all, the General Assembly appoints all the judges.
Come January, the Legislature is going to make SCE&G officials an offer they can't - or shouldn't - refuse.
They should consider being goodfellas, or else the state might pull the plug on them.
Reach Brian Hicks at firstname.lastname@example.org.
More Articles to Read