December 23, 2020: On December 23, the South Carolina Public Service Commission (PSC) fully rejected Dominion Energy South Carolina's (DESC) 2020 Integrated Resource Plan (IRP) and required DESC to file a Modified 2020 IRP within 60 days. This was the first IRP DESC submitted under the newly passed South Carolina Energy Freedom Act, with four out of the seven Commissioners newly appointed by the General Assembly.
After 3 days of testimony and 12 witnesses, the PSC found significant deficiencies with DESC's assumptions on load forecasting, fuel prices, energy efficiency, demand side management, coal retirements, clean energy alternatives as well as deficiencies with its modeling, resource plan alternatives, the selection of its preferred plan and the lack of a short-term action plan. The PSC included a large list of items that DESC must re-do over the next 60 days. DESC must form an IRP Stakeholder Group, which will provide input and review on changes to DESC IRP methodology, modeling inputs and assumptions as well as on guidelines for the required coal retirement analysis. The PSC was persuaded by the testimony of numerous intervenors, including Sierra Club witness Derek Stenclik, that DESC failed to consider near term solar and battery storage as a supply-side resource and failed to consider earlier coal retirements. Not only must DESC include clean energy and early coal retirements in its revised modeling, but it also must re-run their model using the set of assumptions from the Solar Business Alliance witness Mr. Sercy and Sierra Club witness Mr. Stenclik on solar battery storage, escalation rates, combustion turbines, CO2 prices and fuel prices.
Most importantly, for our involvement in this case, based on Sierra Club witness Stenclik's testimony, the PSC concluded that there were other viable, less expensive resource plans that include retiring coal plants and accelerating the transition to clean energy that DESC failed to consider; therefore, DESC is required to immediately perform a robust coal retirement analysis that not only includes the effluent limitation guideline (ELG) costs but the analysis must be conducted prior to making any decisions to retrofit the Wateree and Williams coal plants to comply with the ELG rules. In line with the requirement to conduct a coal retirement analysis, the PSC also stated that it was opening a new coal docket to assess the retirement and replacement of DESC's three coal plants: Williams, Wateree and Cope. This new coal docket will not only evaluate the reliability risks and environmental costs of continued operation but will also assess the replacement of the coal plants, informed by resource bids, with clean energy.
Some additional highlights of the PSC's Final Order include the conclusion that the DESC unreasonably dismissed a high demand side management (DSM) scenario and must now work with the DSM Advisory Group to conduct a rapid assessment of the cost effectiveness of increasing DSM to a 1% level of savings in years 2022-2024. In their next full IRP, in 2023, DESC will also be required to evaluate DSM level of savings of 1.25%-2%. DESC will be required to include in all IRPs going forward, including the Modified 2020 IRP, a DSM Action Plan on how they will meet the DSM milestones as well as a three year action plan on how it will implement its overall IRP. Lastly, DESC must include the proposed bill impacts to customers for each of its resource plans.