This week the S.C. Public Service Commission (PSC) is holding a hearing on SCE&G’s request for an electric rate increase. As an intervenor I have been actively involved in the negotiations with the power company in an effort to significantly cut the initially requested 9.5% hike in rates.
The S.C. Office of Regulatory Staff (ORS), which is responsible for representing all consumers and also tasked with insuring the fiscal health of our private utilities, did the heavy lifting in forging a plan that will reduce the rate hike to 4.88% over three years. All but two of the parties officially involved in this case have agreed to the compromise but the PSC still must approve the plan after the hearing is over.
As part of the compromise reached by the parties, ORS insisted that consumers would not be asked to pay for any discretionary bonuses and raises for SCE&G employees. In these hard economic times, ORS believed that these costs should be borne by the stockholders of the company not the consumer.
The consuming public can expect this kind of oversight process because the state regulates our private utilities. After participating in four previous SCE&G rate hearings that have cut proposed rate increases by over $200 million, I am a believer in government exercising strong regulatory oversight of utility monopolies.
Unfortunately, there is one power generating monopoly in this state that we do not regulate through the PSC—Santee Cooper. Ironically, the state of South Carolina and thus the public owns Santee Cooper and by doing so it is exempt from PSC regulation. Not only does the PSC not oversee Santee Cooper’s business, our elected leaders don’t have any oversight either. It is really a kingdom unto itself with an independent Gubernatorial appointed board.
Which brings us to the announcement this week that Santee Cooper’s Board has agreed to give 3% raises to the top five executives of the power company and in addition adjusted the salary of two of these executives upward by $36,650 and $22,000 respectively.
The pay of these Santee Cooper executives now range from $416,899 for the president to a lowly $249,534 for the general council. Every penny of these salaries and raises will be paid by the consumers of Santee Cooper. No questions asked.
For some time now I have been advocating that Santee Cooper be placed under the regulatory authority of the PSC and thus also be scrutinized by ORS. It is just as much a monopoly as SCE&G, Duke and Progress Energy with the only difference being that it is publicly owned by us. But that doesn’t mean it is making the best decisions for its consumers.