Why the SC Senate just voted to delay the Dominion-SCANA deal

The S.C. Senate voted Thursday to buy lawmakers and state regulators more time to sort through South Carolina’s options after the failure of a $9 billion nuclear construction project.

The Senate proposal, which now goes to the House, would push to December 2018 any ruling by the state’s utility commission on whether Virginia-based Dominion Energy can buy SCANA, the Cayce-based company that led the scuttled V.C. Summer project.

Lawmakers want that decision delayed because the Dominion deal, if is approved by regulators, would seal what SCE&G electricity customers must pay in the future for the useless nuclear reactors.

Senators, who voted 35-0 to delay the Public Service Commission’s ruling, say they need more time to make sure they can’t get a better deal for those customers.

“I’ve put a good bit of time into this over the last six months, but it’s so complicated, consequential,” said Senate Majority Leader Shane Massey, an Edgefield Republican who co-chaired the special Senate committee that investigated the project’s failure. “The magnitude of this is enormous.”

‘We want finality’

The delay wouldn’t necessarily kill the Dominion deal.

The utility’s agreement to buy SCANA expires in April 2019, according to documents filed with the U.S. Securities and Exchange Commission. But Dominion chief executive Tom Farrell has said he would prefer the deal be approved sometime this summer or fall, saying quick approval would address the uncertainty of SCE&G employees and customers.

The Senate now is weighing the Dominion deal against other options, including a House proposal that could reduce what SCE&G’s 700,000 electric customers must pay toward the Summer project.

The State House’s upper chamber doesn’t want to make a decision before it receives advice on how its actions will affect the power bills of SCE&G customers or fare if the actions are challenged in court. But it could be two months or more before the Senate – now trying to hire an outside advisory firm – can receive and digest that advice.

Senators also want to give the S.C. Office of Regulatory Staff, the state’s utility regulator, more time to evaluate the Dominion deal and the circumstances surrounding it, such as whether SCE&G fraudulently won rates hikes for a nuclear project that was failing.

Regulatory Staff director Nanette Edwards told senators Tuesday that her agency could need the rest of the year to evaluate the Dominion proposal, Massey told reporters Wednesday.

“We want finality, too, but we need and ORS needs time to deal with that,” said Senate Minority Leader Nikki Setzler, D-Lexington, who asked Dominion to let up on its push for an quick ruling.

Up in the air

Under current state law, if the Public Service Commission doesn’t rule by July, the Dominion deal would be approved automatically.

PSC approval would nullify challenges to SCE&G’s nuclear-related charges to its customers, which have been launched by state regulators and environmental groups.

The Senate’s proposal now goes to the faster-moving House. The lower chamber already this year has passed a bill that would stop SCE&G from charging its customers some $37 million a month for the nuclear project – about $27 a month for the typical household – until state regulators and the courts decide whether those charges are legal.

S.C. senators plan to take their time debating that House bill.

It is unclear whether passage of the House bill would lead Dominion to withdraw its offer for SCANA.

Dominion’s offer for SCANA includes an immediate $10-a-month in rate cuts for SCE&G’s electricity customers and a cash refund worth about $1,000 per SCE&G household, Farrell said Wednesday

But some members of the Legislature, which essentially can veto the deal, bristle at Dominion’s plan to charge SCE&G customers another $2.8 billion for the abandoned project over the next two decades.

This story was originally published February 15, 2018 at 12:57 PM with the headline "Why the SC Senate just voted to delay the Dominion-SCANA deal."