Columbia, SC, October 21, 2020—Below are the prepared remarks of Frank Knapp, President & CEO of the South Carolina Small Business Chamber of Commerce, regarding the closing of the Mt. Holly Aluminum Plant in Goose Creek, SC. Remarks were made at a press conference in Goose Creek on October 21, 2020.
In March of 2018 I testified at a hearing held by the South Carolina House LCI Public Utilities Subcommittee.
I talked about bad business decisions Santee Cooper had made over the years that cost their ratepayers.
There was the new coal plant Santee Cooper wanted to build. They spent $250 million on engineering, construction and buying equipment before abandoning the project in 2009.
Then there is the 60-year contract Santee Cooper signed to provide Gypsum, a by-product of a coal plant, that they cannot comply with and is costing ratepayers $10 million a year.
And, of course, we all are very aware of the nuclear debacle and Santee Cooper running up a $4 billion construction debt for ratepayers.
I also talked about, yes back in 2018, Santee Cooper’s bad business decision to refuse Mt. Holly’s request to buy the energy the plant needs from the open market, otherwise it would eventually have to close.
Well, here we are over 2 ½ years later and we get the word yesterday that Mt. Holly will close at the end of this year because the plant is losing money due to the high cost of the electricity the plant is paying Santee Cooper for 25% of its energy needs.
But this time the Santee Cooper bad business decision is not only impacting ratepayers, who will have to make up the $16 million a year Mt. Holly is paying for transmission lines.
This time Santee Cooper’s bad business decision is going to devastate the economy of Goose Creek and the entire Charleston region.
300 employees are going to lose their jobs. Not because of anything they did, but because of what Santee Cooper refuses to do.
These jobs average about $90,000 a year and help create the consumer demand for the goods and services of local small businesses.
Then there are the more than 350 local and statewide businesses that provide goods and services to Mt. Holly. Two-thirds of these are in the Lowcountry and will take a financial hit
From research by the Darla Moore School of Business we know that the Mt. Holly closure will also result in:
· 750 additional jobs lost in the Charleston region
· $500 million in economic activity will be lost in the Charleston tri-county region
· There will be a 12% reduction of in-state purchases by other aluminum-using manufacturers
· Aluminum-using manufacturers will be less likely to come to South Carolina because of the higher cost of sourcing aluminum
But unlike all the other bad business decisions Santee Cooper has made over the last 15 years, this is one they can correct.
We are calling on Santee Cooper to stop being an arrogant state agency and make a good business decision.
Let Mt. Holly get the electricity it needs at much lower cost from the open market. Mt. Holly will make sure that Santee Cooper and its customers will be kept whole, and no rate increase will be needed.
Santee Cooper, make a good business decision for a change.