Coalition Proposes Utility Regulatory Reforms

Coalition Proposes Utility Regulatory Reforms

Press Release
From:    STOP THE BLANK CHECK Coalition
Date:      August 20, 1017
Contact: Frank Knapp Jr., South Carolina Small Business Chamber of
Commerce, 803-252-5733 (o), (803) 600-6874 (c), fknapp@scsbc.org
Lynn Teague, League of Women Voters, (803) 556-9802,
teague_l@bellsouth.net

Columbia, SC– The STOP THE BLANK CHECK Coalition (Coalition) was formed in July of 2016 to advocate for utility regulatory changes in an effort to protect electrical utility customers from rate-payer abuse at the hands of a state law, Base Load Review Act (BLRA), and the utility companies. Those efforts focused the attention of the legislature, media and public on the need for reform. House Bill 4022 was introduced in the South Carolina House of Representatives by Rep. Kirkman Finlay and was based largely on recommendations from the Coalition.

With the current disastrous situation at the V. C. Summer Plant, it is clear that other reform efforts are needed beyond amending the BLRA. The Coalition is proposing additional, necessary reforms essential to protect the public in future utility construction projects and regulatory decisions. The Coalition is also advocating for a desired outcome in the V.C. Summer Plant crisis.

  1. The V.C. Summer Plant crisis is the first challenge before the General Assembly and regulators. SCANA should be held responsible for the imprudent project management that brought us to this point. Their shareholders should not be allowed to escape financial responsibility, leaving ratepayers—some of whom are elderly, disabled or live in poverty—to absorb the substantial burden arising from poor decisions and inadequate project oversight. We encourage a strong coordinated legislative and regulatory response to this situation to protect ratepayers and the broader public interest.
  2. The BLRA must be amended or repealed. This law has tied the hands of agency officials, in particular the Office of Regulatory Staff (ORS), and prevented them from fully addressing their mission to consider the interests of ratepayers and the general public. The Coalition supports the amendments for consumer protection provided by Rep. Kirkman Finlay’s bill H.4022, but would also be open to the possibility that a more substantial replacement or repeal is appropriate.
  3. The Public Service Commission (PSC) shoulders blame for the current crisis. While the BLRA might have contributed to the PSC’s inability to find any SCE&G decision regarding the construction of Units 2 & 3 at the V.C. Summer Nuclear Plant as imprudent, the PSC has also lacked public transparency in its decision-making process. The Coalition is concerned about the potential for a PSC perspective biased toward utility interests. The Coalition supports either gubernatorial appointment or public election of PSC Commissioners so that the public can more easily hold either the governor or individual commissioners accountable. However, if public elections are used, there must be exclusive reliance on public financing of campaigns to further protect Commissioners from undue influence from special interests. No person should serve on the PSC if that person has any personal, family or business association with a utility. All parts of the system must be protected from distortion by conflicts of interest.
  4. The Public Utility Review Commission (PURC) is responsible for evaluating the PSC and ORS as well as reviewing the state energy plan of the State Energy Office.  PURC members are both state legislators and private citizens.  All parts of the system must be protected from distortion by conflicts of interest. No person should serve on PURC if that person has any personal, family or business association with a utility.
  5. Santee Cooper needs more accountability in its decision-making. Its public status shields it from the needed regulatory oversight given to private utilities but it also lacks proper oversight by elected leaders. The Governor should be given the ability to remove Santee Cooper board members. In addition, Santee Cooper must be subject to the same regulatory process used in regulation of other utilities. The Coalition believes that any discussion of selling this public asset should be conducted separately from the contentious problems around V. C. Summer.
  6. The Office of Regulatory Staff (ORS) plays a critical role in the utility regulatory process. However, its mission should not include the responsibility of considering the financial integrity of utilities. Instead the ORS mission should be confined to the interests of ratepayers and the general public interest of citizens of South Carolina. The financial health of the utilities should be a consideration only to the extent that it is of concern in addressing the general public interest.       Also, as in the case of any agency head dealing with politically sensitive issues, the ORS Director should be protected from political retribution. Removal should be only for cause, and should require evidence of mismanagement or corrupt activities.
  7. Utility companies should be prohibited from making campaign contributions to individual candidates, parties, PACs or caucuses. The utilities should make their case to legislators without the warm goodwill that money can so easily generate.
  8. A comprehensive state energy plan should be developed that reflects protection of the public interest in a time of rapidly changing technology through a strategy that gives South Carolina diversity of energy sources and flexibility to move forward toward an affordable sustainable future.

Coalition members:

Carolina Peace Resource Center
Kingdom Living Temple
National Association of Social Workers- SC Chapter
New Alpha Community Development Corporation
League of Women Voters of South Carolina
South Carolina Small Business Chamber of Commerce
Sustainable Midlands
The Whitney M. Slater Foundation                                                                                         ###