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Mystery SC Memo Targets NextEra Energy

Document impugns Florida-based utility ahead of debate over Santee Cooper sale ..

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South Carolina state lawmakers are buzzing over a confidential document circulating within the S.C. State House slamming the so-called “Enron type” activities of a Florida-based utility, NextEra Energy.

The document – a copy of which was obtained by this news outlet – is entitled “Why NextEra was kicked out of Texas and Hawai’i.” However, it assails the company (and its subsidiaries) on multiple fronts – not just its failed expansions in those two states.

Comprised almost exclusively of links to mainstream media coverage, the memo’s initial claim is that NextEra “inappropriately and in certain cases borderline unethically tilts the home playing field for solar.”

One article cited in the memo accused Florida Power and Light (FPL) – a subsidiary of the Juno Beach firm – of working “very hard to manipulate the public and political machinations of (solar) rulemaking.”

“Florida is failing in solar power deployment because of FPL and others,” the article concluded. “People’s health and bills, the environment and the planet are bearing the consequences.”

The memo next slammed NextEra for its failed expansion attempts in Texas and Hawai’i, criticisms this news outlet has touched upon in our own prior reporting last year.

Here is a copy of the document (.pdf) …

Along with its crony capitalist partner, SCANA, this debt-addled government-run power provider plunged the Palmetto State headfirst into #NukeGate – a catastrophically failed command economic experiment in the nuclear power business that left a pair of next generation reactors unfinished in Fairfield County, S.C. at a cost of $10 billion.

According to our sources, this file was placed in the hands of multiple state lawmakers – including those currently reviewing offers to purchase South Carolina’s spectacularly mismanaged, state-owned utility, Santee Cooper.

Who put it in their hands? Good question …

As we have stated repeatedly throughout this process, members of the S.C. General Assembly are the reason South Carolina is in its current predicament. And for that matter several other predicaments (here, here and here).

With legislators enabling them, $2 billion of the investment risk associated with the failed #NukeGate project was socialized by SCANA in the form of rate hikes on consumers. Billions more came in the form of debt incurred by Santee Cooper – debt for which taxpayers are now on the hook.

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Ironically, several of NextEra’s staunchest South Carolina advocates played starring roles in this debacle.

So … what does the discussion of a possible sale of Santee Cooper have to do with the leak of this incriminating document? Well, one of the offers to buy the embattled utility (or at least to assume its massive debt) was submitted by NextEra.

Clearly the leaked document intends to throw shade in the direction of Juno Beach as lawmakers mull various bids to buy (or manage) the utility …

Worth noting? NextEra has thrown plenty of shade upon itself throughout this process – beginning with the comically inept formation of a political front group (one that quickly disbanded after being exposed for what it was). Then there was a super secret Santee Cooper purchase plan submitted last winter – a deal that ostensibly represented the culmination of a series of offline negotiations with state leaders.

Meanwhile, this news outlet has exposed various corporate machinations originating from the Florida-based firm – although we have argued these moves were not necessarily out of bounds.

“NextEra has shareholders, and its executives are obligated to generate the maximum rate of return for those shareholders – which means getting new assets for as cheap a price as possible,” we wrote last fall in reference to the company’s failed bid to purchase North Carolina-based PSNC Energy, a SCANA subsidiary that is now owned by Virginia-based Dominion Energy.

Again, we get it … business is business.

(Click to view)

(Via: High Flyer)

Which brings us to our point: Business is exactly what needs to drive lawmakers’ deliberations over Santee Cooper in the aftermath of their failed, costly meddling.

For once, they need to get the hell out of the way and let the free market do its job.

Obviously, Santee Cooper is in terrible fiscal shape. As such, it is never going to command the sort of sum it likely would have fetched more than a decade ago when we first proposed unloading it. Given its exposure to #NukeGate, the utility is unlikely to bring taxpayers much more than they owe on it – as evidenced by the lowball offers its proposed sale elicited.

And let’s be honest – lawmakers have no one to blame for that but themselves.

That does not mean we believe the state should hang on to the utility, though. Far from it. Our belief is that Santee Cooper must be sold as soon as possible for as much as it can possibly fetch …

South Carolina’s politicians have proven unequivocally that they have no business being in the power business …

The sooner they get out of it, the better.

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