House panel advances bill tightening utility rate rules

House panel advances bill tightening utility rate rules

Aiken Standard
April 26, 2017

By Michael Smith

A House subcommittee agreed to advance a bill Tuesday aimed at limiting cost overruns at nuclear and coal plants in South Carolina by more strictly regulating how and when utilities can seek rate increases.

The House Utilities Subcommittee voted 5-1 on H. 4022, a bill that revises the state’s Base Load Review Act. The BLRA makes it possible for public utilities to seek rate increases for facilities that aren’t built yet, such as at the V.C. Summer Nuclear Facility in Fairfield County.

SCANA has sought nine rate increases under the BLRA since 2008, according to the Office of Regulatory Staff, or ORS, to build two AP1000 reactors at V.C. Summer. The project is over budget by at least $2.5 billion.

Rep. Craig Gagnon, R-Abbeville, voted no. Rep. Heather Ammons Crawford, R-Myrtle Beach, abstained.

The vote followed passage of an amendment specifically grandfathering V.C. Summer and other ongoing nuclear projects from more strict BLRA review, a main sticking point of utilities.

ORS Executive Director Dukes Scott said language specifically exempting V.C. Summer was critical to securing utility buy-in. He also said third parties looking to buy into V.C. Summer would fall under the old BLRA standard.

But H. 4022 gives the ORS greater regulatory powers over utilities seeking rate increases on new facilities started after Jan. 1, 2017. Utilities also would be forced to prove a rate hike is needed, according to the bill.

“The utility has the burden of proving that it (rate hikes) are prudent,” Scott said. “It’s not drastic change; it’s just rebalancing it a little bit.”

  1. 4022 now heads to the full House Labor, Commerce and Industry Committee. It’s unclear when the full committee will take it up.

Passage, though, is likely since it has broad public support and South Carolina utilities SCANA and Santee Cooper, partners in V.C. Summer, don’t oppose it.

Groups testifying in support of H. 4022 included the South Carolina AARP, South Carolina League of Women Voters and S.C. Small Business Chamber of Commerce.

Frank Knapp, the chamber’s president, testified that under the current system the S.C. Public Service Commission essentially rubber stamps rate increase requests. He said H. 4022 would provide more regulation.

“I believe the law is currently written in favor of the utility, Knapp said, “and the public service commission, under the old law, they’ve never said no to them (SCANA), and they are a couple of billion dollars over budget.”

Also testifying was a South Carolina Electric & Gas customer identifying herself as Patricia Lutz. SCE&G is a subsidiary of SCANA.

Wearing sweat pants in a sea of suits, Lutz testified she virtually lives in darkness and doesn’t use basic appliances, yet still pays $123 a month in utilities.

“I have not used the range at all since December 2015. I have not used the clothes dryer since April 2015. My bills are constantly going up,” she said. “Last year, the house got to be 91 degrees plus.