SCANA shareholders acted in their own best interest Tuesday when they overwhelmingly approved a buyout from Dominion Energy. It would be unreasonable to expect otherwise.
But it remains far from clear that the Dominion deal — which would be South Carolina’s largest-ever corporate buyout — is the best path forward for the roughly 700,000 families and businesses that buy electricity from SCANA subsidiary SCE&G.
By now, a multimillion-dollar advertising blitz from Dominion has familiarized most South Carolina residents with the basics of its offer — a $1,000 check for the average ratepayer, a 7 percent electricity rate cut, a stock deal for SCANA shareholders.
Those shareholders undoubtedly stand to benefit if the deal goes through. SCANA’s share value has taken a big hit since the nuclear project in Fairfield County was abandoned a year ago, and Dominion has offered shareholders a favorable trade-off of its own stock, which is worth considerably more.
But the average SCE&G ratepayer might be a little disappointed.
For one thing, those $1,000 checks are for the “average” customer. In other words, if you were frugal with electricity use or invested in energy efficiency over the past few years, you’re likely to get a lot less money.
SCE&G customers who didn’t have an account in 2016, or who close their account before the merger is finalized, likely won’t get a penny.
The 7 percent rate cut, while better than nothing, is less than half of the 18 percent of their monthly power bills that SCE&G customers have paid for the failed reactor project, and less than half of the 15 percent rate cut the state Legislature approved a few weeks ago.
And all of this could be rendered moot by any of several ongoing regulatory and criminal investigations and lawsuits against SCE&G.
If state officials find that SCANA acted “imprudently” in continuing to push forward with the reactor project, it might let customers off the hook for hundreds of millions or even billions of dollars. Documents and the testimony of at least one former employee suggest that could happen.
In fact, “prudency” might be the least of SCANA officials’ concerns. Allegations have surfaced that company leaders intentionally misled investors and state regulators, which could rise to the level of criminal activity.
In other words, it’s far too soon to say whether or not the Dominion deal is in SCE&G customers’ best interest. There are still too many moving pieces in the effort to sort out the $9 billion nuclear disaster.
Unfortunately, state regulators might not have much time to sort things out before having to rule on the merger. Lawmakers already extended an initial deadline to review the deal, and they should be willing to push back the cutoff date as much as necessary until we have a clearer picture of how best to protect customers from the fallout of the nuclear debacle.
The SCANA-Dominion merger is clearly good for SCANA shareholders — and its executives, who have an eye-popping $111 million reserved to fund golden parachutes if they lose their jobs in the deal. But it’s still too early to determine the best deal for SCE&G customers, which is what should matter most.