COLUMBIA — Leaders from small business, environmental and community groups joined forces Monday to challenge South Carolina Electric & Gas’ largest rate increase proposal in years.
The Coalition to Stop the Blank Check said the utility’s 3.06 percent rate increase plan is detrimental for low-income customers and small businesses. The increase would cover ballooning costs at the V.C. Summer Nuclear Station near Jenkinsville, north of Columbia.
Frank Knapp Jr., president and CEO of the S.C. Small Business Chamber of Commerce, said the state needs to stop letting SCE&G’s pass along the costs to customers.
“Right now there’s a blank check that the company holds and they are exercising that blank check by raising costs dramatically and delaying the plant’s construction,” Knapp said during a Statehouse news conference Monday.
The group wants lawmakers next year to fix the “blank check” scenario created by the Base Load Review Act, which allowed SCE&G to pass along the financing costs for the expansion while construction is still underway. It said customers should not be footing the costs until the two new reactors at the plant are completed.
“We recognize the right of utility companies to make a fair profit on reasonable and prudent costs,” JoAnne Day, co-president of the League of Women Voters of South Carolina, said. “But (we) believe that in South Carolina the regulatory process of balancing the interests of energy users and producers are not working fairly for the consumer.”
The coalition said SCE&G has charged its customers more than $1 billion for construction of the units and the proposed rate increase would raise another $74.2 million, if approved. Plant construction costs, originally projected at $11.4 billion, currently stand at $13.8 billion.
SCE&G spokesman Eric Boomhower said construction challenges have led to increased costs, but by addressing them now, customers will save $4 billion over the life of the expansion, though it will pinch customers’ pocketbooks.
“We are absolutely sensitive to everything we do and how it impacts our customers,” Boomhower said. “We also have a responsibility to the state, as a whole, to continue to produce cleaner and reliable energy.”
The proposed increase, which needs approval from the state Public Services Commission, would boost residential customers’ rates by around $4.44 per bill for each 1,000 kilowatt hours of electricity used per month. Commercial customers would see their rates increase between 3 percent and 3.3 percent, depending on the size of the business. Lower fuel costs will also help lower power bills, Boomhower said.
Years of rate increases are hitting customers on little or fixed income the hardest, said Carla Damron, executive director for the state chapter of the National Association of Social Workers and a member of the coalition.
“Housing advocates will tell you the rising costs of utilities makes it more and more difficult for our citizens to maintain housing,” Damron said. “We don’t need to burden the most vulnerable of our citizens because of these cost overruns.”
The biggest of eight approved increases since 2009 was 2.87 percent in 2013. The proposed increase is to pay off $846 million in increased costs.
Moncks Corner-based electric utility Santee Cooper — which owns 45 percent of the V.C. Summer nuclear plant — has financed $3.7 billion of its share of construction costs through bond sales. The utility’s board voted in December to increase rates by 3.7 percent in both 2016 and 2017 — Santee Cooper’s first rate increase in three years.
Locally, SCE&G, a division of Cayce-based SCANA Corp., provides electricity and natural gas to Charleston and Dorchester counties and parts of Berkeley County.
David Wren of The Post and Courier contributed to this report.