SC regulators’ approval of selling SCANA is bad news for electric ratepayers.

That’s the assessment of the ruling by SC Small Business Chamber of Commerce CEO Frank Knapp, Jr., an intervener in the Public Service Commission hearings.

“What this ruling means for SCE&G’s ratepayers is that electric rates will not be cut by an additional 5% as proposed by the Office of Regulatory Staff,” he said.

“Today’s rates were already temporarily reduced by 15% per the instruction of the legislature. Now this 15% rollback will be permanent, at least until the next rate case.

“Rates have increased by 18% since 2009 to pay the financing costs of the construction of the now abandoned nuclear project. SCE&G spent $5 billion on this construction and will recover much of that money from ratepayers.

“This is the outcome promoted by the Speaker of the House [Jay Lucas] who made the unusual and controversial move to formally intervene in this hearing ostensibly to represent the House of Representatives.

“The general sentiment of those close to this process was that the Speaker’s political influence would result in the PSC complying with his request. The Speaker got what he wanted.”

Knapp cited what he called other negative aspects.

“The PSC refused to include securitizing the construction-cost debt that SCE&G will now be able to recover from ratepayers.

“Securitization is a bonding instrument used in 17 other states to secure bonds at cheaper interest rates because the government guarantees the debt will be paid.

“Ratepayers save money. But the PSC rejected recommendations for its order to include securitization should the legislature pass a bill allowing its use.

“The PSC approved a 9.9% Return on Equity, essentially profit on SCE&G’s construction costs it is allowed to recover. The ORS had proposed a 9.1% ROE.

“The difference on the average monthly residential bill for the 9.9% versus 9.1% ROE will be an additional 32 cents. While that is not much, that is $3.84 more per year for the average ratepayer for the next 20 years, or $76.80.

“Again, not much. But multiply $76.80 times 720,000 ratepayers and you get over $55 million extra revenue for the utility.”

Knapp said “the nuclear debacle brought to us by the mismanagement and deceit of SCE&G executives comes to a close at least for the utility. Dominion will buy SCANA and the state will have a new and more powerful big-dog utility to have its way with the legislature, the PSC and ratepayers.

“Now the legislature will focus on what to do about the $4 billion of abandoned nuclear construction costs owned by Santee-Cooper, the state’s power company that provides 80% of the energy for local co-ops.

“Will Santee-Cooper be sold in whole or in parts? Or will the state find a way of keeping it as a state agency? This will consume much of the legislature’s attention next year.”