SCE&G rate hike plan goes to panel

By Dave L’Heureux, Staff Writer

South Carolina Electric & Gas Co.’s proposed electric rate increases will hurt retirees, working people and businesses, speakers told utility regulators Monday.

SCE&G wants to raise electric rates by $112 million per year, starting February, largely to boost its generating capacity. It is asking the S.C. Public Service Commission to let it increase those rates.

The SCANA Corp. subsidiary wants to raise rates, ranging from 5.4 percent for industrial customers to 14 percent for small businesses. The average residential customer would pay 7 percent more a year.

Three people who testified Monday before the commission said the proposed increases are harmful and ill-timed.

“A lot of people live on $400 to $600 a month, and they have high medical costs,” said Ralph Lewis, a retiree living in South Congaree.

Boating supplies entrepreneur John W. Casey of Columbia said higher electrical rates could put him out of business.

“Energy is 10 percent of my costs,” he told regulators. “It affects whether I stay in business or close up.”

The proposed rate increases could slow South Carolina’s recovery from the 2001-02 recession, said Robert Slimp of Columbia, who said he spoke for himself and the S.C. Heritage Coalition, which is upset with a SCANA policy that banned employees from displaying the Confederate battle flag on private vehicles in the company’s parking lot.

“If you can’t avoid electrical rate hikes, then give us a choice of utilities,” Slimp told regulators.

Frank Mood, an outside attorney representing SCE&G before the commission, said no one – including the utility – wants to raise electric rates.

“Still, SCE&G has reached a critical point in its financial life,” Mood told regulators. “There is a sense of urgency. And it is important that we prove that the relief sought is in the best interest of our company and its customers.”

The company said it needs to charge higher rates to help it generate additional power.

Neville Lorick, president and chief operating officer of SCE&G, said the rate increase is based on a 9.93 percent overall return on rate base, including a 12.5 percent return on common equity.

The requested increase reflects recovery of about $248 million to update and run the 670-megawatt Urquhart Generating Station near Aiken.

It also will provide $277 million for early construction of a 875-megawatt Jasper Generating Station near Hardeeville. That plant will open in spring 2004.

The increase also will furnish $222 million for environmental improvements at several other generating plants.

Lorick said the company’s capital investments are up 18 percent, to $692 million, since the last electric rate increase in 1996.

It also serves 63,022 more retail customers than in 1986. The company now serves 550,000 electricity customers in 24 counties, including the growing Columbia and Charleston metro centers.

The company set records three times for electrical demand during the past summer.

“We cannot wait any longer to seek higher rates in order to meet our fundamental needs,” Lorick said.

Attorneys for a series of opponents argued that SCE&G has no real need for such a large increase in its electrical rates.

“SCE&G has a good, fast-growing service territory,” said attorney Rob Tyson, representing the S.C. Merchants Association. “It is not in financial peril.”

Tim Wilkes, president of the S.C. Small Business Chamber of Commerce, predicted SCE&G will win little, if any, of the higher rates it is seeking from the Public Service Commission.

“They have put the commission in a terrible bind,” Wilkes said. “Everybody is hurting in this economy. As word about this rate request gets out, I think you’ll see a lot more grass-roots opposition.”

The commission will decide on the SCE&G request by February, executive director Gary Walsh said. It resumes testimony at 1 p.m. today. Testimony will wrap up Friday, at the earliest.

Scroll to Top