SCE&G electric rates going up again
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S.C. Electric & Gas has won approval from state regulators for another electric rate hike — its sixth boost in five years.
Combined with a rate hike approved earlier this year, the new rates boost the average SCE&G residential bill by about $5.50 a month.
The 2.3 percent hike on residential bills approved this week is part of annual increases that help pay for the Cayce utility’s portion of a $9.8 billion expansion of a Fairfield County nuclear plant.
SCE&G initially sought a 2.82 percent rate increase, but lowered the request after calculating current project costs and a court decision rejected passing on some costs to customers, spokesman Robert Yanity said.
The new rate takes effect on bills sent out starting Oct. 30.
Under state law, SCE&G can raise rates to pay for adding two reactors at the V.C. Summer Nuclear Station each year until the second new reactor goes online in 2019. Having customers pay for construction before the reactors are fired up should save $1 billion in costs and interest payments, the utility said.
SCE&G raised electric rates twice last year in the first moves to pay for the nuclear plant expansion. By the end of the decade, residential customers are expected to pay $480 a year more because of the nuclear-related increases than they did in 2009.
This summer, the Public Service Commission of South Carolina approved a 4.88 percent rate hike that started in July and is being phased in through mid-2012. SCE&G is using money raised from the rate hike to pay for $700 million federally required environmental upgrades and a backup dam at Lake Murray.
That rate hike was contentious, drawing nearly 600 protest letters and e-mails as customers chafed that the request came during a lingering recession and soon after power bills spiked from an abnormally cold January.
To ease the blow, SCE&G cut its original rate hike request in half, agreed to give customers a $25 million credit for the high January bills and try a plan for a year that could lower — or raise — bills if weather is abnormal during a month.
SCE&G also agreed to hold off on most other hikes until July 2012. But that does not apply to rate hikes tied to rising costs to fuel its power plants or to expand the nuclear plant in Jenkinsville.
In August, the S.C. Supreme Court ruled that regulators should not have allowed SCE&G to include $438 million in rate hikes to cover potential cost overruns for the nuclear plant expansion. The court said SCE&G can ask regulators to recover those costs when they occur. The utility said the court decision has no impact on construction.
SCE&G serves about 660,000 customers from the Midlands to the Lowcountry.