Politics & Government

Electric co-op reform bill advances in SC House but faces opposition

A House panel on Wednesday unanimously OK’d a proposal to — for the first time — give the state’s utility watchdog oversight over South Carolina’s 20 electric cooperatives.

But at least one lawmaker promised to oppose the bill if it reaches the House floor for a vote.

The bill, H. 3145, would allow the Office of Regulatory Staff to audit the little-known co-ops and raise red flags if one of the small utilities is breaking state law or misspending money. The agency would take major disputes with a co-op to the S.C. Public Service Commission for a ruling.

The proposal stems from The State’s reporting last May that part-time board members of the St. Matthews-based Tri-County Electric Cooperative had enriched themselves with high pay, expensive benefits and inappropriate perks.

Those costs were charged to the co-op’s rural customers-owners, who were paying some of the highest electric rates in the state. Three months later, the co-op’s customers rose up and overthrew Tri-County’s entire board in a historic vote.

The episode brought attention to South Carolina’s 20 little-known and scantly regulated co-ops, whose leaders also have higher pay and more expensive benefits than their co-op counterparts across the country.

The co-op reform bill was filed by state Rep. Russell Ott, a Calhoun Democrat who represents many of Tri-County’s 13,600 customers. It has the support of the Electric Cooperatives of South Carolina. The co-ops’ statewide trade association worked with Ott for months on the bill.

However, the bill will face some opposition if it reaches the House floor.

State Rep. Wendy Brawley, a Lower Richland Democrat who also represents many Tri-County customers, said statewide legislation isn’t always the best solution to local problems.

She noted Tri-County Electric’s customers worked together to fix their co-op’s problems.

“I do not support giving the PSC or ORS any authority over co-ops,” she said. “The co-ops are best served when co-op members are empowered by the bylaws they enact.”

Ott said his proposal wouldn’t take any power from co-op customers. It simply will empower a watchdog to have their backs, he said.

The bill also adds new ethics and transparency rules for electric co-ops, which traditionally have seen little scrutiny.

“There is no perfect solution to bad actors acting badly,” said John Frick, a lobbyist for the Electric Cooperatives of South Carolina. “What we’ve tried to do is bring sunlight to the process, bring accountability to the process.”

Avery G. Wilks is The State’s senior S.C. State House and politics reporter. He was named the 2018 S.C. Journalist of the Year by the South Carolina Press Association. He grew up in Chester, S.C., and graduated from the University of South Carolina’s top-ranked Honors College in 2015.