SCE&G raising rates

South Carolina Electric & Gas Co. customers might get a little hotter in May, and not just from the summer heat.

The Columbia-based subsidiary of Scana Corp. said Monday it will raise electric rates 2.44 percent, for a $2.80 increase in the average monthly electric bill that will come to $117 for a residential customer using 1,000 kilowatt hours.

SCE&G had sought a nearly 4 percent rate increase to pay for increased coal-hauling costs, which doubled after the utility's rail contract expired in December.

It also said it was forced to buy coal at high prices in the open market after undisclosed suppliers "did not meet their contractual obligations" in the latter half of 2008, when prices nearly tripled to $150 a ton. It is seeking legal remedies against those suppliers and, if successful, will use those funds to offset higher fuel costs.

The size of the rate boost was reached under an agreement between the investor-owned utility and the state Office of Regulatory Staff. The increase reflects an adjustment in the fuel cost portion of electric rates.

SCE&G will spread the price increase over three years.

"With the economic challenges so many of our customers are facing today, we thought it best to spread the cost out over a longer period, which in turn, will lessen the financial impact on customers," said Kevin Marsh, SCE&G's president.

Approved fuel costs are billed as direct pass-through to customers. SCE&G does not earn a profit on that portion of its rates. Fuel costs represent about 31 percent of what residential customers pay for a kilowatt hour of electricity.

SCE&G serves about 650,000 customers in 26 counties in South Carolina. About 283,000 of those are in Berkeley, Charleston and Dorchester counties. Another 13,633 are in Colleton County.

Other South Carolina electricity customers also are facing higher bills.

Last week, state-owned power provider Santee Cooper said it is considering a 7.5 percent increase for residential electricity customers beginning in November, followed by a 7.6 percent increase in November 2010.

If both rate increases are implemented, the average household electric bill for affected customers would rise $6.47 and $8. Rates also would go up for other classes of customers, such as commercial and industrial.

Santee Cooper said the increases would be the first in its "base" rates since 1996. It said it has invested nearly $3 billion since then to double its generating capacity to keep pace with its 60 percent customer growth rate.

The Moncks Corner-based utility is soliciting comments from the public about the proposed higher rates and is planning to hold a series of open meetings beginning May 26. Its board plans to vote on the issue in August.

Santee Cooper supplies power to more than 163,000 retail customers in Berkeley, Georgetown and Horry counties, as well as to 29 large industrial facilities, the cities of Bamberg and Georgetown, and Charleston Air Force Base.

It also generates the power distributed by the state's 20 electric cooperatives to more than 700,000 customers in all 46 counties. About 2 million South Carolinians receive their power directly or indirectly from Santee Cooper.

Reach Warren Wise at wwise@postandcourier.com or 937-5524.