NextEra Energy is telling S.C. lawmakers it wants to buy Santee Cooper, pay down the state-owned power company’s $8 billion in debt and give partial refunds to its electric customers for the utility’s failed nuclear project.
The Florida-based power giant’s most recent pitch to lawmakers also includes a rate freeze for those customers until 2022.
Over that time, NextEra plans to refund to Santee Cooper’s customers about $200 million of the more than $540 million they have paid in higher bills for the utility’s failed attempt to expand the V.C. Summer Nuclear Station in Fairfield County.
More details of that conceptual offer, which The State reported on last month, were laid out in documents obtained by The State newspaper Thursday. Those documents – a set of slides detailing the proposal – were first published Thursday afternoon by the S.C. political blog Fits News.
A lawmaker confirmed the power company had used that slideshow to pitch him on the potential proposal, which NextEra has not yet offered officially.
The terms are fluid and likely to change as NextEra gets feedback from S.C. lawmakers on its proposal, some lawmakers say.
NextEra declined to comment Thursday.
Finding a way to pay off Santee Cooper’s debt and take care of the utility’s customers will be key for any buyer to win a sale’s required approval of the S.C. Legislature.
NextEra is perhaps the most aggressive of a handful of companies that confidentially have expressed interest in buying or taking over Santee Cooper. State leaders are mulling a possible sale after Santee Cooper took on $4 billion in debt before abandoning the decadelong Summer project last July.
That sale is the only way to repay Santee Cooper’s customers what they have been charged for the reactors, some state leaders say.
But any deal, according to Gov. Henry McMaster and other state leaders, must be the best option for those customers, including 177,000 customers who get their power directly from Santee Cooper and about 1.5 million S.C. residents who buy the utility’s power through 20 electric cooperatives.
Still, some lawmakers — including state Sen. Larry Grooms, the Berkeley Republican whose district includes Santee Cooper’s headquarters — are skeptical a for-profit utility can take over the state-owned utility without raising rates.
NextEra’s proposal, documents show, would:
▪ Freeze those rates at their current levels until 2022. The utility offers no assurances beyond that.
▪ Refund Santee Cooper’s customers $50 million a year for the next four years. Half of those refunds would be repaid with tax breaks from the state, the documents state.
▪ Pay down Santee Cooper’s $8 billion in debt – about half of which is tied to the Summer project. The utility would have to cover $1.5 billion of those costs to pay off the debt early.
To do that, the documents show, NextEra proposes to spend about $1.8 billion of Santee Cooper’s own money, including an $831 million settlement from the parent company of the Summer project’s now-bankrupt lead contractor.
NextEra also proposes pitching in $6 billion of its own cash and borrowing $1.75 billion, documents show.
The Florida-based utility also is telling lawmakers it wants to invest $2 billion to modernize Santee Cooper’s power system.
Grooms, who has met with NextEra officials, said they told him their company would build a 1,100-megawatt gas-fired plant in Anderson County and a few solar farms across the state.
Those efforts would create about 2,800 temporary construction jobs and 100 permanent positions, the documents state. The new plants also would contribute about $150 million a year to local and state tax rolls, about five times more than Santee Cooper now pays in fees, documents state.
Grooms said NextEra wants a tax exemption for the power plants and property it would buy from Santee Cooper, which currently are tax exempt.
Santee Cooper has said it has not been involved in any NextEra negotiations.
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