Lower power bills at stake as business groups push to break monopolies’ grip in SC
As South Carolina struggles with how to provide more energy, major business associations are touting proposals they say could lower power bills while easing the pressure to develop new energy-generating plants in the near future.
One proposal would allow large industries to buy power from utilities outside the state as a way to save money. Another would require power companies to participate in an energy pool that some say would ensure better prices for energy needed during times of peak demand.
The proposals, expected to be included in larger energy legislation this year, would effectively deregulate part of the state’s energy system, which gives utilities monopolies to serve certain territories.
South Carolina utilities oppose the plans, saying such efforts could soak residential ratepayers, despite advocates’ assurances the changes would not do that.
But big industries say these energy monopolies squelch competition and South Carolina needs changes in the way it provides power. They also argue that average customers would not be hurt.
“It’s time to be innovative, it’s time to step out of this ‘Lets-just-keep-doing-what-we’ve-always-done’ approach to providing electricity,’’ Columbia lawyer Scott Elliott said during a news conference this week on the State House steps.
Elliott, who represents the recently formed Palmetto Industrial Energy Association, spoke in favor of legislation that would allow big companies such as Century Aluminum, Amick Farms and Alpek Polyester to buy power from utilities other than those now serving them.
Instead of being forced to buy from Dominion Energy, Santee Cooper or Duke Energy, big industries could negotiate rates with utilities in other states.
The idea is that another power company, such as Georgia Power, could provide better energy rates for big industries, or at least force competition with South Carolina utilities that would lower prices.
Nationally, 19 states allow outside sales of some sort, including Georgia.
A study recently done for the energy users group estimated that allowing outside sales could save individual industries anywhere from $350,000 to $7 million annually, depending on their size. The estimated savings comes from an examination of five states that allow outside sales, according to Daymark Energy Advisors, a consulting firm hired by the big industry organization.
Sen. Wes Climer, R-York, said the proposal may be part of Senate energy legislation that is being developed in the upper chamber or it could be attached to a House bill that was approved recently. Climer spoke in favor of allowing big industries to buy power from utilities outside of their service territories.
While helping big energy users, Climer said he could guarantee the change would not cause rising residential power bills.
A key concern is that utility lines would have to be upgraded to handle energy coming in from other states, and that cost could fall on residential ratepayers. But Climer said the need to upgrade infrastructure, after industries strike deals with power companies outside traditional territories, would be borne by those large industries.
“The language that we are contemplating (in the legislation) would require that any large user fund the cost of infrastructure associated with their retail choice,’’ Climer said.
Now, big industries — like residential customers — are required to buy their power from the utility that serves a specific service territory. Dominion Energy, for instance, has the service territory for much of the Columbia and Charleston areas.
The other plan would require utilities to participate in what is known as an energy imbalance market. Utilities would buy wholesale power through a central energy pool when power demands are high, according to plans. Utilities now make their own deals with other utilities if they need to purchase extra power. The imbalance market would have to be approved by the state Public Service Commission before it took effect, boosters of the proposal say.
Under the plan, an automated system would find the best prices for power needed at a time of high demand, if utilities seek to buy power, supporters say. The market would be managed by an independent, non-profit entity approved by the PSC.
Most states, except those in the Southeast, participate in energy imbalance markets, according to information from the Clean Energy Buyers Association. Participating in such a market could save electricity customers $360 million annually, the association says. The buyers association has about 400 members nationally.
““South Carolina voters across the political spectrum see the need for the state to require establishment of a wholesale energy market,” the association’s southeast deputy director, Katie Southworth, said in a recent news release. “The current system of monopolies locks in higher rates with fewer options for addressing threats to long-term grid reliability..’’
She noted recent polling by her organization found a majority of 600 South Carolina residents surveyed were receptive to the idea. Such a market would reduce demand for expensive new energy plants and better ensure all customers, including individual homeowners, are not overcharged for energy, she and others with the association said.
“This is not going to solve all problems, but it is an incremental step forward,’’ Southworth said in an interview with The State.
Those offering energy in the imbalance market would include utilities from South Carolina and possibly other states, as well as independent power sources, such as solar farms.
Utilities don’t like either plan.
The current system of allowing power company to have monopolies better protects the average ratepayer from rising monthly bills, utilities say. While utilities have monopolies, any rate increases they want to impose must be approved by the state Public Service Commission, which hears cases challenging rate increases.
“Dominion Energy does not believe deregulating the energy industry in South Carolina – in any form – is in the best interest of the state or our customers,’’ according to a statement from Rhonda O’Banion, a spokeswoman for Dominon Energy.
“The integrated, regulated energy market in South Carolina provides extensive accountability and rigorous third-party oversight from state and federal regulators,” she said. ”This is critical to our ability to provide the reliable, affordable and increasingly clean energy that powers our customers every day.’’
Santee Cooper, the state owned power company, said it would not be interested in participating in an energy imbalance market because its current practices already mirror such a market.
“There is no need for an energy imbalance market in South Carolina,’’ Santee Cooper spokeswoman Mollie Gore said in an email. “Santee Cooper works closely with Dominion and Duke to ensure the reliability of the grid and ensure adequate reserves.’’
Power companies also point to national news reports showing that deregulating utilities has actually cost the average residential customer.
A 2023 story in The New York Times found that the average retail electricity costs in 35 states that have fully or partly approved utility deregulation have risen faster than in 15 states that had not allowed deregulation. Residents in a deregulated market pay $40 more per month for electricity than those in states where individual utilities control all or part of the energy grid, the Times reported.
Recently in Maryland, officials have been working to limit rising residential power bills in the state, where some deregulation has occurred, according the website Pluribus News.
“It’s no surprise that an industrial group is pushing for policies they think will lower power bills for themselves,” said Avery Wilks, a spokesman for South Carolina’s electric cooperatives, in response to efforts by the Palmetto Industrial users group. “Our job is to advocate for energy policies that benefit all of our consumers, including the hundreds of thousands of South Carolina families and small businesses that depend on us for electricity.’’
The efforts are being pushed at a time when the state’s utilities say they badly need more energy to meet growing demand, particularly from industrial customers that include data centers. Proposals are on the table to build a 2,000 megawatt natural gas plant in Colleton County and to study restarting the failed V.C. Summer nuclear expansion project in Fairfield County.
Major energy legislation that attempts to remove possible roadblocks to energy expansion passed the House last week. Among the obstacles to the energy legislation are environmental regulations and legal appeals, proponents of the House measure say.
This story was originally published February 19, 2025 at 10:36 AM.
