By Paul Gable
Companion bills filed by Rep. Heather Crawford and Sen. Luke Rankin, in the two houses of the SC General Assembly, appear to have a goal of requiring electrical cooperatives to purchase electricity from Santee Cooper regardless of the cost.
The bills, introduced by Rankin in the Senate on February 9, 2023 and by Crawford in the House on February 28, 2023, read as follows: “A BILL TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY AMENDING SECTION 58-37-40, RELATING TO INTEGRATED RESOURCE PLANS, SO AS TO PROVIDE THAT CENTRAL ELECTRIC POWER COOPERATIVE MUST SUBMIT ALL PROPOSED CONTRACTS OR OTHER PLANS FOR THE PROCUREMENT OF ELECTRIC GENERATION TO THE JOINT BOND REVIEW COMMITTEE, THE STATE REGULATION OF PUBLIC UTILITIES REVIEW COMMITTEE, AND THE PUBLIC SERVICE COMMISSION OF SOUTH CAROLINA PRIOR TO EXECUTION.”
Central Electric Power Cooperative provides wholesale electric service to South Carolinas electric cooperatives such as Horry Electric Cooperative and Pee Dee Electric Cooperative. It obtains most of its power through long term purchase agreements with Santee Cooper, Duke Energy Carolinas, and the Southeastern Power Administration.
If these bills pass, CEPC will have to obtain permission from the three state agencies listed before it can execute a new contract. With Santee Cooper owned by the State of South Carolina and deeply in debt because of its involvement in the Summer Nuclear Power Plant construction debacle, there is little doubt among the individual electric cooperatives that purchases from Santee Cooper will be required by the three agencies whenever possible, regardless of the cost to the individual coops and their customers.
When the Summer power plant construction was abandoned in 2017 by South Carolina Electric and Gas and its partner Santee Cooper, it represented the largest business failure in state history. SCE&G and Santee Cooper had reportedly invested $9 billion into the project at the time of abandonment. The original cost of construction was estimated at $8.5 billion when it was proposed in 2008 but had risen to at least $25 billion by the time it was abandoned with only approximately 30% of the construction completed.
SCE&G and its parent company SCANA merged with Dominion Energy as a result. Despite the wishes of SC Gov. Henry McMaster, the SC General Assembly chose to reform the organization of Santee Cooper and keep it under state government control. The smart move would have been to sell Santee Cooper off to a much larger power company which could have absorbed Santee Cooper debt into their balance sheets. Dominion Energy and NextEra Energy from Florida were both potential suitors. However, apparently for a number of political reasons, some of which have to do with the lack of oversight by the State Regulation of Public Utilities Revies Committee, of which Rankin is a member and which failed miserably in its oversight of the Summer nuclear power plant cost and construction, the General Assembly chose to keep the problem in house.
In 2020, Santee Cooper settled class action lawsuits by its ratepayers and the individual electric cooperatives for $520 million. Part of the settlement included a guarantee by Santee Cooper that it would not raise its rates for four years. That guarantee will end in just over one year from now with requests for considerable rate increases expected to follow shortly. However, Santee Cooper customers have continued to pay an extra 5% on their electricity bills to help pay off the utility company’s debt.
Santee Cooper does much of its business east of Columbia, especially in the areas served by Horry Electric Cooperative, Pee Dee Electric Cooperative and the low country. In other words, customers in those areas should get ready for significant increases in their electric bills beginning next year.
It is interesting the sponsors of the bills, Rankin and Crawford, come from Horry County where their constituents will inevitably experience rate increases. Rankin was the major force in the SC Senate in blocking the sale of Santee Cooper, the result of which will be an inevitable rise in the cost of power for his constituents.
Crawford is even more interesting. Not only is she a member of the House from Horry County, but also the District Director for Congressman Russell Fry’s 7th Congressional District. Most, if not all of the 7th Congressional District’s constituents are consumers of Santee Cooper power, either directly or through one of the local cooperatives who pay Santee Cooper for power.
A Congressional member and members of the state legislature are expected to act in the best interests of their constituents. Keeping ownership of Santee Cooper by the state is not in the best interests of the citizens of Horry, Dillon, Chesterfield, Marion, Florence, Marlboro and Darlington counties, to name a few. Fry was still a representative to the SC House when the decision was made by the General Assembly to maintain ownership of Santee Cooper.. Now Fry’s buddy Rankin and district director Crawford are sponsoring bills which will inevitably bring higher electricity bills to those same constituents as well as their own.
Word has reached GSD that Fry and Crawford are attempting to have the electric cooperatives hold fundraisers for his next Congressional campaign. Isn’t that like saying bend over and smile but help me get reelected anyway?