BRADENTON, Fla. – South Carolina Gov. Henry McMaster has spoken with investor-owned utilities about purchasing the state-owned public power agency known as Santee Cooper.
McMaster is considering several options following last week’s collapse of the V.C. Summer nuclear reactor project after Santee Cooper and SCANA Corp.’s South Carolina Electric & Gas announced they would not complete it.
“The governor is just exploring all of his options, and the sale of Santee Cooper is one of them,” a spokesman for the governor’s office said Thursday. “A sale would likely be one of the most drastic options.”
McMaster has contacted Dominion Energy about a possible sale, but SCE&G has not been approached, the governor’s office said. SCE&G was funding 55% of the nuclear project, which failed following the bankruptcy of primary contractor Westinghouse.
SCANA told state regulators last week that it wanted to complete one of the reactors when 45% owner Santee Cooper determined completion of both units was not feasible. Without a partner, SCANA said it was forced to submit a petition to abandon the project.
The South Carolina Public Service Authority, as Santee Cooper is formally known, has $7.7 billion of outstanding bonds. Of that amount, $4.4 billion was used to pay for its share of the unfinished reactors.
“I think any outstanding bonds or debt obviously would be taken care of in any deal that would be made,” the governor’s spokesman said.
The governor is also exploring other options, his office said, including protection for ratepayers “who paid for the project to be completed,” helping the 5,000 workers who lost jobs when Santee Cooper opted out of the project, and finding a company to complete one of the reactors.
State lawmakers and citizens have complained that Santee Cooper and SCE&G collected billions from ratepayers for reactors that won’t be completed, and that the utilities intend to raise rates to pay off debt used toward construction.
The SCPSA has covenanted with bondholders to maintain rates and other charges to make debt service payments.
When asked for a comment about a possible sale and the impact on its bonds, Santee Cooper spokeswoman Mollie Gore directed questions to the governor’s office.
Last week, after S&P Global Ratings downgraded Santee Cooper’s bonds to A-plus from AA-minus, Gore said the agency’s board has a “proven track record of approving rate increases when it is prudent to do so.”
Santee Cooper’s Board of Directors has scheduled a meeting Friday to hold an executive session about rates, and to consider a resolution titled “2018-2019 Rate Revision Process,” according to the agenda. No other information was available.
Two state lawmakers have called for a special session of the Legislature to consider prohibiting rate increases by the utilities involved with the V.C. Summer project until lawmakers meet in regular session next year.
On Wednesday, House Speaker Jay Lucas, R-Darlington, announced the appointment of an 18-member Utility Ratepayer Protection Committee.
Santee Cooper was created by the state in 1934, and provides power to 2 million customers.
