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#NukeGate: Secret Documents Detail New Santee Cooper Offer

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The South Carolina State House is abuzz over documents detailing a proposed deal for state-owned Santee Cooper, the mismanaged government-run utility that’s drowning in debt after its role in #NukeGate – a spectacularly failed command economic intervention in the Palmetto State’s energy industry.

The documents were provided to this news site by two lawmakers who say they received them from “lobbyists.”

None of the lawmakers who gave us the documents would say which lobbyists provided them, although we have a guess as to who they might be.

The timing of the leak is also interesting – coming just two weeks after Florida-based power company NextEra Energy reportedly began pitching state lawmakers on a deal for the beleaguered utility.

Chatter surrounding a possible NextEra deal has been rampant at the S.C. State House for weeks.  We originally reported on it here, with a follow-up treatment here.  We also exclusively reported weeks ago on the company engaging in offline negotiations with lawmakers.

We have called for such offline negotiations to cease, arguing that any deal for a public utility must be conducted in public.

Legislators were originally expecting NextEra to make a bid for both Santee Cooper and crony capitalist utility SCANA – its partner in the failed V.C. Summer nuclear expansion project in Fairfield County, S.C.  However, we’re told NextEra couldn’t match the ratepayer relief proposed by Virginia-based Dominion Energy – which has made a $14.6 billion offer to purchase the Cayce, S.C.-based utility.

NextEra was reportedly a suitor of SCANA, but those efforts fell through three months ago.

Why are these utilities on the block?  #NukeGate, a case study for what happens when government is allowed to run a power company – and when government officials are allowed to socialize investment risk for projects funded by private energy providers.

(Click to view)

(Via: High Flyer)

To recap: With state lawmakers and regulators cheering them on, SCANA and Santee Cooper spent $10 billion (including $2 billion taken directly from ratepayers) on a pair of next-generation nuclear reactors in Fairfield County, S.C.

The money was spent, but the reactors were never finished.  In fact they’re not even half-finished – with the cost to complete them reportedly ranging from anywhere between $9-16 billion.

Drowning in debt, Santee Cooper pulled the plug on the reactors six months ago – killing an estimated 5,600 jobs, squandering billions of dollars in investment and throwing the state’s energy future into chaos.

Just eight days before it bailed on the project, Santee Cooper announced massive rate increases on customers tied to “costs associated with nuclear construction and other system improvements.”  The utility has also given its former leader a multimillion-dollar, taxpayer-subsidized golden parachute – even though documents released last summer showed its executives (and SCANA’s leaders) knew two years ago that the project was doomed.

Anyway … the anonymous proposal would ostensibly reduce Santee Cooper’s debt to zero, freeze rates for customers and refund them $200 million (half of which would come courtesy of state taxpayers).

“Refunds would be partially offset by temporary tax abatements from the state,” the proposal noted.

It also promises $2 billion in energy infrastructure investments – primarily in solar and natural gas.

Take a look …

(Click to view)

(Via: Provided)

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