COLUMBIA — With pressure mounting, the South Carolina House voted Wednesday to temporarily halt $37 million in monthly payments to SCANA, threatening a proposed takeover by Dominion Energy.
State representatives ignored urgent pleas from SCANA, once the darling of South Carolina's business community, by overwhelmingly supporting a bill that relieves the Cayce-based company's electric customers from paying for two useless nuclear reactors at V.C. Summer station — for now.
"We need to protect the ratepayer. That is our job. That is what we were elected to do," House Speaker Jay Lucas said during a rare speech from the House floor.
"There are business decisions being made," he said. "I can’t impact that. But what I can impact are rates I think are being unfairly paid by the citizens of this state."
The bill would suspend payments while the issue goes through the courts. The lopsided 119-1 vote highlighted how far the reputations of SCANA and its subsidiary, S.C. Electric & Gas, have fallen since utility officials cancelled the $9 billion nuclear power project in Fairfield County last summer.
SCANA's stock rallied Wednesday afternoon after plunging earlier in the day. But the company continued to slide farther from its sale price: The gap between SCANA shares and their equivalent in Dominion stock widened to more than 25 percent, a sign that Wall Street investors have doubts about the deal.
The plan is to unburden more than 700,000 electric customers from paying for the abandoned reactors near Jenkinsville while utility regulators and the state's court system determine whether SCANA or the state's homeowners and businesses pay for the multibillion failure.
Those utility regulators on the S.C. Public Service Commission are already reviewing the cancelled project. On Wednesday, they voted to reject a shortened hearing schedule that SCANA requested. They also asked the Office of Regulatory Staff — the state's utility watchdog — to conduct a second audit of SCANA's finances after determining that company had just a one-in-three chance of going bankrupt without the reactors payments.
Senate Majority Leader Shane Massey, R-Edgefield, and Minority Leader Nikki Setzler, D-West Columbia, announced their support for the House bill Wednesday. Massey said he hoped to hold an initial hearing on the legislation by next week.
Even if the Senate moves quickly on the legislation, the dispute over who pays for one of the biggest economic development failures in South Carolina history will continue. The contentious issue would land with the Public Service Commission and, possibly, the S.C. Supreme Court, where many people expect the case to wind up.
SCANA's inability to convince lawmakers of the company's dire financial position demonstrated the lack of trust it maintains in a Statehouse where it once wielded influence with ease.
SCANA's attorneys, lobbyists and executives warned for months that cutting off the nuclear-related charges will bankrupt the utility. Even the support of the S.C. Chamber of Commerce hasn't convinced lawmakers of the utility's cause.
SCANA officials have already said they will have no choice but to sue the state if the bill passes and Gov. Henry McMaster signs it into law. On Wednesday, McMaster's office said governor would sign the current bill.
SCANA did not respond to a request for comment. Virginia-based Dominion was still reviewing the House bill, but said it would certainly put "SCE&G in a precarious financial position."
"The House action, assuming it becomes law and survives legal challenges, could offer temporary relief for SCE&G customers, but unfortunately could threaten the permanent solution offered by Dominion," the company wrote in a statement.
House members altered their legislation to not fully repeal the reactor payments before the vote Wednesday to improve the state's chances of winning a costly and protracted legal battle with SCANA.
State Rep. Gary Clary, a Clemson Republican who was a circuit judge, said in tailoring the bill the House avoided a "constitutional landslide." Had the House passed its initial legislation, he said, all bets would have been off once the bill was challenged in court.
Rep. Peter McCoy, a Charleston Republican who led a special House committee that investigated the nuclear project, emphasized that lawmakers were listening to customers, not the utilities.
"Members in this body have been pushed, have been lobbied by outside influences that are looking to protect themselves and to line their own pockets," McCoy said from the House floor. "Today the body said 'no' to that."
The House's bill rolls back most of the 2007 law that jump-started the V.C. Summer project, known as the Base Load Review Act, and allowed SCANA to charge customers as it attempted to build two of the first nuclear reactors in the United States in three decades. The legislation keeps parts of that law intact, but makes it more difficult for SCANA's attorneys to argue they made appropriate decisions in overseeing the troubled construction project.
Rep. Micah Caskey, a Republican who represents the district where SCANA is headquartered, has been contacted by customers and employees alike, his constituents pulling him in two separate directions.
After months of reviewing evidence about the nuclear cancellation, Caskey said he couldn't vote to allow SCANA to continue to profit from the abandoned project. He cited a Post and Courier investigation from September that revealed how SCANA and its contractor, Westinghouse, disregarded the state's professional engineering laws when designing the reactors 30 miles from Columbia.
"Every day we wait, the price tag goes up," Caskey said, as he asked lawmakers to pass the bill.
State Rep. Jonathon Hill, a Townville Republican who said the bill did not refund all the money spent on the nuclear debacle, cast the only dissenting vote Wednesday.
Lucas used his speech to answer critics who said lawmakers were bought off with campaign contributions from the utilities and business community in passing the Base Load Review Act. He pointed to the large group of lobbyists hired in the wake of the nuclear fiasco, saying "We are making them a lot of money."
"Who represents the ratepayers?" Lucas asked. "I wanted to say this to all the old timers in the room who got criticized for voting for the BLRA. If I knew then what I know now, I would not have (voted for it). Look at the money not flowing in here but look at the money outside and who’s getting paid off, because it ain’t us. It’s not us in this room."