By Barney Blakeney
As the 2020 South Carolina legislative session gets underway, advocates for the sale of Santee Cooper electric cooperative hope this year legislators will approve its sale. They make a strong argument for that. Marilyn Hemingway and the Gullah Geechee Chamber of Commerce are among those proponents. In a recent interview Hemingway, the chamber’s founder and CEO, said in its present form Santee Cooper has forgotten its mission of providing low cost services.
Founded in 1934 as a public service project that provides electricity to rural communities, Santee Cooper created two lakes while building hydro-electric dams and power plants. It is South Carolina’s only state-owned electric and water utilities agency. Santee Cooper directly serves about 2 million residential and commercial customers in Berkeley, Georgetown and Horry counties, according to sale advocates. A board member represents each congressional district and each of the three counties where Santee Cooper serves retail customers directly; one board member has previous electric cooperative experience; and the chairman is appointed at-large.
Santee Cooper supplies power to the cities of Bamberg and Georgetown, 30 large industrial customers, and Charleston Air Force Base. Santee Cooper generates the power distributed by some of South Carolina‘s electric cooperatives. Headquartered in Moncks Corner, it is one of the largest power providers in South Carolina.
Hemingway joins a chorus which advocates for the cooperative’s sale. Their voices reached crescendo after the 2017 abandonment of the Virgil C. Summers nuclear plant construction. The failed project leaves Santee Cooper customers on the hook for the debt associated with the project. The co-op’s total debt, including that associated with V.C. Summer is more than $9 billion.
Hemingway cited the cooperative’s 2009 $250 million loss after abandoning construction of a new coal-fired plant in the Pee Dee region. The project was ill-conceived in the first place she said, because everyone knows the adverse consequences of coal burning. The 2017 V.C. Summer fiasco followed. The cooperative has spent some $9 million in legal fees. And its history of financially inept decisions is ongoing. Its agreement to supply a by-product of coal burning will cost the cooperative $10 million annually through 2069, according to sale advocate sources.
Yet the cooperative pays its executives more than any other state agency – some $2.4 million annually. In September 2017, CEO Lonnie Carter announced his retirement following the decision to abandon construction of the V.C. Summer Nuclear Generating Station leaving Santee Cooper with debts of about $4.4 billion for the partial construction. For his leadership and vision, Carter is projected to receive over $800,000 a year in retirement.
Hemingway says all that’s money down the drain. She says of the options legislators are considering to re-engage Santee Cooper, sale is best. Under any scenario rate increases will occur in the normal course of doing business, she said. But it’s obvious the state hasn’t exemplified good stewardship as a utilities owner. That’s partly because as a state-owned utility it doesn’t get oversight from the Public Service Commission and its board isn’t reflective of its consumer base.
“From our point of view, we should start over,” Hemingway said. “Now is the time for South Carolina to show some leadership.”