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South Carolina Legislature Unlearns Classes, Promotes Main Fuel Business Push – SACE | Southern Alliance for Clear EnergySACE


Proposed South Carolina laws threatens main rollback in favor of utilities, on the expense of South Carolinians.


Eddy Moore | February 23, 2024

| Power Coverage, Fossil Fuel, Nuclear, South Carolina, Utilities

This weblog was written by SACE Decarbonization Director Eddy Moore.

South Carolina Legislature Proposes to Roll Again Price-Payer Protections

5 years in the past, after utility firms spent $9 billion on a nuclear plant that was by no means completed, the South Carolina legislature reformed the legislation to extend scrutiny of utility plans and assist renewable vitality produced by impartial builders. Now, a brand new Speaker of the Home is main a utility-supported effort to roll again these reforms and increase gas-fired energy. If handed, the invoice would enhance prices for residents, undermine the state’s utility planning course of, threaten continued buildout of latest utility-scale photo voltaic, and drive up local weather air pollution throughout the state.

Main Fossil Gas Growth

The Speaker’s invoice signifies legislative assist for about 9,000 megawatts (MW) of latest energy vegetation that will burn fracked fuel, plus new fuel pipelines. The roughly $9 billion capital price for the facility vegetation alone would equal nearly $2,000 every for each man, lady, and youngster within the state. The gas for the facility vegetation will possible exceed the price of the vegetation themselves.  This invoice is a multi-decade deadweight on the long run economic system of the state.

Simply one of many new fuel vegetation—a three way partnership of Dominion Power and state-owned Santee Cooper—could possibly be as massive as 2,000 MW and would take seven or extra years to construct as a result of it first requires expanded interstate fuel pipelines throughout delicate wetlands and greater than 100 miles of electrical transmission upgrades. The legislative endorsement of the undertaking, which is working its manner by means of state approvals even with out particular laws, provides additional insurance coverage for the utility firms that ratepayers will likely be required to foot the total invoice if the advanced undertaking has main price overruns. The undertaking additionally would enhance reliance on fuel in Dominion Power territory from the present 40% of all vitality generated to nearly 60%, tying its clients to worldwide fuel worth spikes for many years to come back as an alternative of signing fixed-price renewable vitality contracts.  

Eroding Client & Environmental Protections

In a state through which the legislature instantly chooses the members Fee that regulates utility charges, the legislative endorsements would override the regulatory course of. The regulatory course of is additional undermined by quite a few different provisions of the invoice. For example, it requires the Fee to offer particular consideration to proof supplied by utility firm witnesses. It additionally restores a pre-reform mandate for the Public Service Fee to assist the monetary integrity of the utility (which is already ensured elsewhere within the legislation), moderately than having regulators focus extra on the wants of ratepayers.  And it eliminates the authorization for the state’s Workplace of Client Affairs to intervene on behalf of utility ratepayers, which was enacted as a direct results of the nuclear fiasco. These strikes to brief circuit regulatory assessment processes are a blow to South Carolina residents because the Public Service Fee and the assessment processes they oversee stand as the one important examine on monopoly utilities’ revenue motive at ratepayers’ expense. 

The invoice additionally threatens the primary technique of renewable vitality growth in South Carolina by shortening the size of ordinary contracts for brand new utility-scale photo voltaic amenities from ten years to 5. Underneath present legislation, these contracts set the phrases beneath which utilities purchase vitality from renewable vitality suppliers, and thus are the idea of financial institution financing for the tasks. Reducing the financing interval in half will both drastically minimize the income for photo voltaic or drive up the required unit price of vitality in order that photo voltaic is priced out of the market. Both manner, this provision would possible kill an in any other case rising photo voltaic and battery storage market. And it’s patently unfair:  for comparability, coal-fired energy vegetation in South Carolina are at present financed by ratepayers for over 70 years. 

Remarkably, given the current historical past of nuclear undertaking abandonment in South Carolina, the invoice additionally authorizes as much as three new “small modular” nuclear reactors. This novel know-how is untested and the one undertaking in america was just lately deserted for price overruns. If the South Carolina reactors are deserted just like the final one, utility firms could be required to offer a “fulsome accounting,” however nonetheless could possibly be allowed to cost ratepayers for the vegetation.  

Whereas the laws clearly fails to heed the teachings realized after the $9 billion nuclear fiasco in South Carolina, its higher significance is an entire embrace of gas-fired energy for many years to come back. Out-of-state fuel producers and pipeline firms see the electrical energy enterprise as their solely actual progress alternative within the home US market. The fuel business is combating for market share, attempting throughout the southeast to beat renewable vitality to the punch as photo voltaic costs decline and utilities nationally more and more flip to battery storage for dispatchable capability.

Take Motion to Combat Again

Hopefully, as legislators hear from constituents shocked by the invoice’s backward emphasis on fossil gas growth and monopoly revenue moderately than aggressive clear vitality, they may pause and rethink. South Carolina is dwelling to a various and rising clear vitality economic system, and new know-how and regulatory approaches can meet our electrical energy wants at decrease price and threat.  For example, South Carolina ought to require its utilities to take part in a regional wholesale market to enhance reliability, price, and transparency. The state legislature spent nearly one million {dollars} learning this selection and located that it could save over $300 million per 12 months, however shelved the examine when utilities complained. Additionally, aggressive renewable vitality procurement processes have been demonstrated to decrease price and pace integration of fresh vitality sources. And binding vitality effectivity program targets would pace adoption of the most affordable vitality of all—the vitality not generated within the first place. However step one for South Carolina to reliably meet its vitality wants needs to be to rethink the backward legislative strategy represented by the just lately launched invoice.



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