South Carolina’s Public Service Commission has always had a reputation for cozying up to the utilities it’s supposed to regulate.
That credibility problem reached new heights with the V.C. Summer collapse, because the PSC approved rate hike after rate hike as SCE&G and state-owned Santee Cooper poured billions of dollars into the nuclear reactors that they eventually abandoned mid-construction.
It wasn’t always fair to blame the agency. The Legislature wanted the reactors built and made that clear to the PSC, whose members it elects. Once commissioners signed off on the project, the Base Load Review Act (since repealed) didn’t give them much room to reject the add-ons to our power bills. Then when they took up Dominion Energy’s plan to purchase SCE&G parent SCANA Corp., they had to stay within the confines of state law and the U.S. Constitution, which made it impossible to spare ratepayers any further costs for the nuclear building spree.
But the commissioners could have paid a little attention to the nuclear opponents who warned correctly that the project was doomed, and they might have been able to needle out more information from SCE&G that would have raised red flags.
And even as they ordered refunds and then lower rates under a new state law, regulators seemed to cling to their loyalty to the regulated, refusing to make a legal finding that SCE&G had misled the state and acted imprudently in continuing construction as long as it did. Under intense political pressure, commissioners did reverse course and make that important finding a month later, but the damage of the initial vote was already done. Just more of the same, it seemed.
Now comes the battle to expand solar energy, and once again the commission seems to be playing footsie with the regulated utilities, which have battled for years to prevent solar incursions into what they believe should be their sole province: selling electricity to South Carolinians.
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.
This spring, the Legislature passed a long-fought law to lift a state-mandated cap that would have made it prohibitively expensive to install new solar panels on homes and businesses. H.3659 also charged the PSC with setting the prices Dominion and Duke Energy will pay for electricity generated by independent solar providers. To assist with this highly technical task, the law allows the PSC to ignore state procurement law and hand-pick “a qualified independent third party” consultant.
The word “independent” appears 22 times in the law to describe the consultant, the consultant’s review and an evaluator to be hired by the Office of Regulatory Staff. Which should have given commissioners a hint that Legislators wanted them to hire someone … independent. Without any ties to Dominion or Duke or the solar industry.
So what did they do? As The Post and Courier’s Andrew Brown reports, they hired Pegasus Global Holdings, whose client list is a Who’s Who of electric utilities. Did I mention that the electric utilities have fought solar-energy expansion in South Carolina since forever?
Pegasus pocketed at least $3 million in 2011 to defend a multibillion-dollar Duke project in Indiana. And Chairwoman Patricia Galloway served on the SCANA board of directors and is an associate member of the Edison Electric Institute, an industry association that lobbies for investor-owned utilities. It is currently led by Duke CEO Lynn Good.
The PSC’s chief clerk told Mr. Brown that commissioners didn’t know about the Duke contract and that Dr. Galloway made a “commitment that she would not be involved in any way with Pegasus’ consultation with the PSC.” That’s sort of like the secretary of Homeland Security saying the president has made a commitment not to be involved in any way with immigration enforcement decisions: Chances are good the secretary already knows where the president stands, and can take that into account without the president’s involvement.
Not surprisingly, legislators who fought for that “independent” language are infuriated. The solar industry has filed a protest. And the PSC will meet at 2 p.m. Wednesday to discuss its contract with Pegasus.
I suppose it’s possible that Pegasus really can act as an independent consultant, and that there’s simply no other company that has the knowledge the PSC needs. But the burden is on the PSC to explain why Pegasus is the best option, and to convince us. Because, unfortunately, it hasn’t earned the benefit of our doubt.
Cindi Ross Scoppe is an editorial writer for The Post and Courier. Contact her at email@example.com or follow her on Facebook or Twitter @CindiScoppe.