SCANA makes big cut in dividend as SC Legislature cuts rates; stock rallies

SCANA announced a big cut in its quarterly dividend Thursday, amid continuing fallout from the V.C. Summer nuclear debacle and action Wednesday by the S.C. Legislature to cut the electric rates that the utility charges customers.

The Cayce-based utility cut its quarterly dividend by 80 percent, to 12.37 cents a share. That is a drop from 61.25 cents from 2018's first quarter.

In a statement, SCANA said, "The board made this reduction to preserve its options as the company continues to seek a resolution to the recovery of costs for the V.C. Summer new nuclear construction project."

On Wednesday, SCANA's stock closed at $36.79 a share, down 4 percent. It was poised to open down another 4 percent on Thursday, at $35.40, according to premarket numbers. However, SCANA shares rallied after the stock market opened, climbing as high as $39.10 before closing at $38.50, up $1.71 a share.

S.C. lawmakers passed a proposal Wednesday to cut electric rates for customers of SCANA's SCE&G subsidiary by 15 percent. That change would eliminate almost all of the 18 percent surcharge that SCE&G customers now pay for a failed effort to build two now-abandoned nuclear reactors in Fairfield County by the utility and the state-owned Santee Cooper utility.

That cut could leave SCANA looking for other options to cover billions of dollars of unpaid costs for the abandoned project. However, the utility is expected to sue in court to block the rate cuts if they become law, saying they are unconstitutional.

The rate cut also could cause Dominion Energy — the Virginia-based utility offering to buy out SCANA — to withdraw its takeover offer and its promised benefits, including $1,000 refund checks to SCE&G customers and a $10-a-month rate cut.