COLUMBIA (AP) A federal judge refused Aug. 2 to end a lawsuit by a private South Carolina utility that also is seeking to stop a temporary rate cut for customers who continue to pay for an abandoned nuclear reactor project.
The 15 percent rate cut, retroactive to April, is set to begin appearing on South Carolina Electric & Gas bills Aug. 7 unless a court rules otherwise.
In her 20-page ruling, Childs said SCE&G had a right to sue. The utility claims the General Assembly did not follow a 2007 state law that should have allowed SEC&G to increase rates to pay for the two nuclear reactors being built at the V.C. Summer site north of Columbia before any power was generated.
The utility maintains that the law also allowed it to keep charging to pay debt even if the reactors weren’t finished. SCE&G and a minority partner, state-owned Santee Cooper, gave up on the project in July 2017 after a decade of planning and construction. It was more than $8 billion in debt.
The Legislature revoked the law this year and also passed a temporary rate cut to end almost all the rate increases passed to pay for the plants. If the rate cut stays, an average SCE&G customer would see around $25 a month taken off their average $163 power bills.
If allowed to stand, the temporary rate cut will stay until the Public Service Commission sets a permanent rate, likely around the end of this year.
Lawyers for the state House and Senate, as well as for the commission, asked for the lawsuit to be dismissed. They spent much of a two-day hearing on the matter trying to poke holes in SCE&G’s claims that the rate cut would financially hobble SCE&G and its parent company, SCANA Corp.
Items that came up in the hearing included SCANA putting millions of dollars into an irrevocable trust to pay key executives and facilitate the company’s merger plans with Dominion Energy of Virginia.
Shareholders approved the merger July 31, but they also in a nonbinding vote rejected golden parachutes for top executives if they lose their jobs as a result of the sale to Dominion.
But SCANA officials said those payments are locked in place. Eleven current and former SCANA executives will get paid more than $38 million, The Post and Courier of Charleston reported.
SCANA also released its earnings for the second quarter on Aug. 2. The company had profits of $8 million from April to June of 2018, compared to $121 million during the same three months in 2017, before the nuclear project was abandoned.
A statement from the company blamed the steep decline in profits on setting aside money to pay for possible rate cuts. SCANA estimates the temporary rate cuts will cost around $270 million for a company that had more than $4.4 billion in operating revenue in 2017.
SCANA’s stock also has taken a huge nosedive, falling from an 18-month high of more than $71 a share in June 2017 to closing Wednesday at just over $40 a share.