South Carolina’s most fiscally liberal “Republican” lawmaker pressed on this week with his bid to block the privatization of the state’s chronically mismanaged, debt-addled government-run utility, Santee Cooper.
Luke Rankin – Santee Cooper’s top legislative apologist – continues to claim the state-owned power provider can “reform” itself despite its starring role in the botched construction of a pair of since-abandoned nuclear reactors in Jenkinsville, S.C.
Rankin was a key legislative architect of this command economic debacle – which we christened “NukeGate.” All told, this fiasco set Palmetto State taxpayers and ratepayers back more than $10 billion – and counting. In fact, Santee Cooper’s massive (and expanding) debt is one of the main reasons this news outlet has consistently called for the utility to be offloaded to the private sector.
The other reason? Duh … government shouldn’t be in the business of running a power company.
Of course, we have been arguing for Santee Cooper’s privatization since 2008 – which is right around the time Rankin and his allies were plunging the state headfirst into the NukeGate mess.
Should we really trust these same lawmakers to “reform” the utility? And beyond that, what does “reform” even mean?
Another reshuffling of the deck chairs on a sinking ship?
As this news outlet has repeatedly chronicled, Santee Cooper has claimed it can achieve $2.7 billion in savings over the next two decades owing to “a greener energy mix and other efficiencies.” Key to this new “mix” (and the promised savings) is the shuttering of the utility’s antiquated coal-fired power plants – and all of the economic baggage associated with them.
The problem? Santee Cooper “cannot quit coal” – as evidenced by the extent to which the utility was forced to rely on the environmentally unfriendly power source during a cold weather event last month. Not only did Santee Cooper have to fire up all of its coal units to address market supply fluctuations, it experienced multiple issues with the operation of two of these units – forcing the cancellation of a scheduled power sale that was supposed to cover the costs of restarting them.
At one point, things got so bad Santee Cooper was forced to issue a warning to its industrial customers regarding potential blackouts.
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Anyway, Rankin conveniently ignored these issues during a hearing this week on his so-called Santee Cooper “reform” bill – praising the utility and its board members for their extensive “qualifications.”
“Too bad he did not reference his business partner is on the board,” one observer noted, referring to recent questions regarding Rankin’s proximity to board member David Singleton. In addition to these questionable ties, Rankin is receiving campaign contributions from Santee Cooper’s board chairman Dan Ray.
Rankin’s “thick as thieves” status with Santee Cooper is especially troubling given the utility’s ongoing flouting of a state law intended to govern its conduct during sale negotiations. Specifically, this “rogue agency” has continued to rack up new debt in direct contravention of both a legislative edict – and the terms of a recent court settlement that gave ratepayers back pennies on the dollars they lost due to the abandoned nuclear reactors.
After adding $100 million in red ink to its multi-billion dollar debt last fall, Santee Cooper’s ostensibly “qualified” leaders acknowledged earlier this year that they needed yet another $100 million in “new money proceeds” by the fourth quarter of 2021 to stay afloat.
Obviously, additional debt means the cost of purchasing the utility rises … which begs a painfully obvious question: Is Santee Cooper’s real “reform plan” to rack up so much debt that selling the utility becomes impractical?
In other words, are they attempting to maintain their cushy, state-conferred monopoly by running up additional red ink?
That isn’t the question we really want answered, though.
The real question is this: Why are state lawmakers letting them get away with it?
Obviously, Rankin and his allies are in the tank … but why are other legislative leaders allowing this to happen?
Once again, this is further proof of the need to offload this anti-competitive albatross sooner rather than later. It is also cause for lawmakers to haul Santee Cooper’s “qualified” board members before their committees to answer for this avalanche of extra-legal debt.
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