Recap of South Carolina Energy Policy in 2018 Legislative Session

Following the cancellation of the V.C. Summer nuclear power plant, the 2018 legislative session in South Carolina was a historic opportunity for significant, long-lasting reform in South Carolina energy policy. Political focus over the last year gravitated to energy issues and by the beginning of the session in January, energy was anticipated to be the number one issue.

So let’s see what policies legislators proposed, and which of those policies they actually passed:

Policy introduced in legislation Policy passed into law?
Repealing advance cost recovery for construction of risky power plants and rolling back customers’ rates that pay for the canceled nuclear construction Yes
Establishing a consumer advocate to fight for consumers in utility regulatory cases and reforming the mission of public interest-focused state agency ORS Yes
Tweaking the selection process for utility regulators and Santee Cooper board members No. Several bills to accomplish this were passed by the House but not the Senate.
Raising the limit of fair compensation to solar customers No
Encouraging competition from independent power producers No
Promoting low-cost energy efficiency No
Banning political campaign contributions from utilities No

Taken together, these bills sought to address some of the serious issues that led to the V.C. Summer disaster that left customers potentially holding a $10 billion bill.

The session started off with a bang in the House, as it passed several bills in just a few weeks, while the Senate delayed taking action on most legislation for months. Some of the most hotly debated issues were: 1) repealing advance cost recovery for risky power plant construction; 2) rolling back the rates that SCE&G customers are paying for the canceled nuclear construction; and 3) eliminating the arbitrary cap on how many solar customers can receive fair compensation for their power. While the bill to eliminate the solar cap received a large majority of votes in the House of Representatives, it was blocked by a procedural move, leaving fair compensation for rooftop solar unaddressed [editorial note: as of July 11, Duke Energy Carolinas has announced that they will stop giving their current solar compensation deal to solar applications received beginning August 1].

While a large portion of the session was spent by the Senate figuring out how much to temporarily cut SCE&G customers’ rates, many issues that were introduced as legislation did not receive hearings or make it to a vote. Not until a special session convened several weeks after the regular session ended, did a single bill pass. But with just hours left to act, the Legislature passed two bills, which together accomplished the following:

  • Sets the V.C. Summer abandonment and SCANA/Dominion merger proposal hearing for November
  • Defines “prudency” in the Base Load Review Act so that it will be harder for SCANA to defend that some of its historic rate increases for the V.C. Summer plant were prudent
  • Prevents future use of the Base Load Review Act for advance cost recovery for risky power plant construction–this is significant because Duke won’t be able to recover costs of its Lee plant costs via BLRA
  • Temporarily rolls back SCE&G rates to 2011 levels, which is about 15% of customers’ bills
  • Changes the mission of the Office of Regulatory Staff to no longer be concerned with the financial integrity of utilities or economic development of the state
  • Gives the ORS clear ability to demand review of documents from utilities without confidentiality agreements or protective orders (although such documents must be treated as confidential) and the ability to request subpoenas from the courts
  • Creates a position of consumer advocate in the Office of Consumer Affairs to represent ratepayers in utility regulatory proceedings

Some of these outcomes are major progress. We are disappointed that other issues did not get addressed during this legislative session, however we look forward to the Legislature continuing to fight for customers’ interests in 2019.

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