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A primer on the timeline
Over the past five weeks, we’ve discussed developments leading to legislation that will enable the buildout of new energy generation from both fossil fuels and renewables. We began with an omnibus-style bill from Senator Tom Davis (Beaufort) (S.909) introduced the first week of session, pairing recommendations from the Electricity Market Reform Study Committee with authorizations for a new natural gas plant to be built in the Lowcountry located at the former Canadys coal plant.
Questions about Davis’ proposal and other utility requests were then raised at the Public Utilities Review Committee, followed by hearings from the House Economic Development and Utility Modernization Ad hoc Committee proposing their version of a transformational energy bill, which we briefed last week.
All of this work from various legislative committees and stakeholders has led us to a critical juncture for determining how our state will meet increasing energy demand, modernize how we generate and manage energy resources, shift to cleaner energy sources, and protect ratepayers.
House Speaker proposes new bill
Last week, the Speaker of the House, Murrell Smith, introduced the South Carolina Ten-Year Energy Transformation Act (H.5118), alongside over 60 cosponsors, signaling the prioritization of this bill. The bill will now go through the normal committee process in the House Labor, Commerce, and Industry Committee, which will provide opportunities for public input.
Now, let's dive into what's in this proposal.
Concerns
It allows many utility projects to avoid the process the SC Public Service Commission (PSC) uses to consider proposals for new natural gas pipelines, gas plants, and transmission lines by:
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expanding exemptions for obtaining a Certificate of Environmental Compatibility and Public Convenience and Necessity (CPCN). These certificates are critical to ensuring new energy projects are reasonable and avoid unnecessary environmental impact;
- allowing utilities to begin clearing, excavation, and construction for pipelines, transmission lines, or gas plants that are part of an approved utility Integrated Resource Plan (IRP) before PSC approval of the project. IRPs are not and should not be a substitute for the CPCN process.
It establishes that a new natural gas plant — specifically a large, 2,000 megawatt combined cycle plant built at Canadys in a joint venture between Santee Cooper and Dominion — is in the public interest, which would aid in the PSC’s consideration to approve the plant.
We believe the CPCN process should determine the scale and nature of the proposed plant, and that the project should be able to stand on its own merit. What is notable about this proposal is that an independent study commissioned by the PSC concluded that Santee Cooper should consider downsizing the plant and incorporating more solar and battery storage to meet demand.
Lastly, it authorizes state-owned Santee Cooper to serve as an “anchor subscriber” for natural gas and pipeline capacity, which would make South Carolina the first state in the country to do so. This authorization would allow Santee Cooper to enter into decades-long contracts with pipeline companies to build natural gas pipelines, and shoulder the financial liability. Before we authorize the state to get into the gas business, we should think twice about the environmental and fiscal impacts this idea could have on the state.
Finding Common Ground
The bill also aims to:
- increase access to renewables by increasing the net metering cap to 5 MW,
- encourage and clarify PSC authorization for utility programs that cover energy efficiency and demand-side management,
- direct the Office of Regulatory Staff to study the benefits of a third-party administrator of energy efficiency programs.
When weighted with the potential ramifications of the permitting rollbacks outlined earlier, however, these provisions don't go far enough to ensure the state can meet its energy needs in the most efficient, clean, and affordable way.
While there may be merit to expediting certain proposals, the bill as proposed could result in hasty, long-term commitments to the types of generation sources that are almost assuredly going to get left behind as we modernize our energy systems. We should use existing oversight methods to ensure the best projects are advanced to meet future needs of the state while expanding access to renewable energy resources and energy efficiency to meet near-term energy demand.
Ultimately, decisions that drastically alter land use, affect private property rights, and tie us to financially risky projects should be made in the sunlight of public accountability, with input from local elected leaders, businesses, and residents. We look forward to working with lawmakers to ensure this bill achieves its ambitious goals while honoring community input and accountability.
Ok, so what to do with all of this information?
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Reach out to your legislator about these issues! Tell them you want meaningful changes to the bill to protect ratepayers and balance gas promotion with provisions that bolster renewables. We also need to make sure communities have a voice in decision-making related to proposed gas plants and infrastructure.
- Show up in person to the upcoming House LCI subcommittee hearing the week of February 27 and consider testifying or submitting written comments. We will provide more information on how to do this next week.
- Talk to your neighbors about this bill! This affects all of us.
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