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SC solar industry seeks to 'disqualify' consulting firm with deep ties to utilities

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The S.C. Public Service Commission determines how much big electric utilities must pay solar providers for the power they generate. File 

The solar industry and several environmental organizations want South Carolina's utility regulators to drop a consulting firm with deep ties to the state's largest investor-owned utilities. 

The South Carolina Solar Business Alliance and Southern Alliance for Clean Energy were among the groups that sent letters to the S.C. Public Service Commission on Monday asking the panel to reconsider its contract with Pegasus Global Holdings

The consulting firm was hand picked by the state's seven utility commissioners, and is currently tasked with helping to set the prices big power companies will pay for electricity generated by independent solar providers. 

The problem is that Pegasus and one of the firm's top leaders have a history with Duke Energy and Dominion Energy, the two investor-owned electric utilities operating in South Carolina.

Pegasus was paid at least $3 million in 2011 to defend a multibillion Duke project in Indiana. And Pegasus's chairwoman, Patricia Galloway, previously served on the board of directors for SCE&G parent SCANA Corp., which Dominion bought earlier this year. 

Pegasus is also an associate member of the Edison Electric Institute, an industry association for the country's investor-owned utilities. Duke CEO Lynn Good is currently the president of the trade group. 

The Solar Business Alliance said that information "calls into question whether Pegasus has been properly vetted for other potential conflicts of interest." 

"The commission should immediately disqualify Pegasus from acting as the commission's independent third party expert," the group added. 

The PSC already scheduled a meeting on Wednesday to discuss whether to continue its work with Pegasus, which stands to make between $131,000 to $175,000. The contract can be canceled if the commission gives Pegasus 30 days notice. 

Duke and Dominion said they had nothing to do with the selection of Pegasus.

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Dominion attorney Chad Burgess sent an email last week informing the commission that the Richmond, Va.-based utility had no objection to Pegasus advising the commissioners. 

Not everyone is as comfortable with the arrangement. 

Blan Holman, an attorney representing both the Southern Alliance for Clean Energy and the Coastal Conservation League, called for Pegasus to be dismissed. 

Like several other groups, he questioned whether Pegasus's employees had the needed experience to advise the commission on the costs utilities should pay for solar power.

Some of the groups opposing Pegasus were indirectly applying political pressure on the PSC too. Several of them shared their letters to the PSC with lawmakers who are in charge of vetting the utility commissioners. 

Several of the commissioners are up for reelection in the General Assembly next year. 

A handful of state lawmakers criticized the decision to hire Pegasus last week. Those legislators said they believe the contract with Pegasus violated state law, which specifically called for an "independent third party" to be hired to assist the commission in the solar cases. 

Sen. Brad Hutto, D-Orangeburg, is one of the state lawmakers in charge of reviewing potential candidates for the PSC. He's glad the commission chose to review its decision to hire Pegasus.  

"I don't know all the details, but from what I've read it does cause some concern," Hutto said. "The idea is that they are supposed to be independent. I'm sure there are people out there who don't have these connections." 

In the end, Hutto said it's up to the PSC to determine if the company is qualified for the job. 

Reach Andrew Brown at 843-708-1830 or follow him on Twitter @andy_ed_brown.

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