Fossil fuel path for Santee Cooper Is most expensive for customers going forward

COLUMBIA, S.C. – A new report being distributed to lawmakers shows that a Santee Cooper future based on additional fossil-fuel power will saddle customers with hundreds of millions of dollars in higher costs in the future compared to other energy options.

The report from national energy experts looked at a variety of energy mixes for the state-owned utility and determined Santee Cooper’s continued reliance on coal or building large fracked-gas plants would be the costliest options.

The least-cost option for the utility, which saves customers the most money, is to phase out coal plants and to focus on renewable energy and energy-efficiency programs, the experts concluded. The report builds on a national trend in which utilities are increasingly favoring clean energy sources because it costs less than legacy fossil power sources. 

The report is being released as the State of South Carolina considers what to do with the utility. Santee Cooper was a 45 percent partner in the failed VC Summer nuclear station that cost customers $9 billion before the contractor went bankrupt and the utilities abandoned the project. Customers will pay higher bills for decades to cover the debt.

Lawmakers will be presented with three options for Santee Cooper: sell the utility; hire a company to manage it; or reform it.

“This report doesn’t take a position on who should own or operate Santee Cooper, but it does show in stark terms what its energy future should be,” said Blan Holman, managing attorney for the Southern Environmental Law Center. “Santee Cooper customers have already been afflicted with one massive and costly power plant debacle. They can’t afford another.”

In letters to state lawmakers and regulators, Santee Cooper leadership recently committed to more solar energy, but also proposed building new gas plants.

Synapse Energy Economics used state-of-the art energy modeling software to determine

that a combination of renewable energy options and energy-efficiency programs is the utility’s cheapest option to serve its customers. Among the more costly options: Keeping coal units operational while building a fracked-gas plant and running pipelines to it.

“The embarrassment of the VC Summer debacle presents us with an opportunity to do something bold and innovative that will save money for Santee Cooper customers,” said David Rogers, Southeast Regional Deputy Director of the Sierra Club's Beyond Coal Campaign. “This report confirms we are at a tipping point for energy production in South Carolina. Renewable energy and customer efficiency are now the cheapest, least risky options and we should pursue them.”

Highlights from the report:

• The report used state-of-the-art utility-industry modeling software and accounted for several possible energy mixes and scenarios to meet the current and projected power demand. Reliance on renewable energy proved cheaper for customers than fossil fuel based projections.
• A gas-based plan could cost customers an extra $1 billion if gas prices rise.
• It is now cheaper to build and run renewable power plants—while meeting all reliability requirements—than it is to just run Santee Cooper’s coal plants.
• The falling costs of solar power and battery storage means that building these options in annual increments over time is now cheaper than sinking upfront capital into new fracked-gas plants and running pipelines to them.
• Building renewable energy plants instead of large gas plants would save up to $597 million, even if gas prices do not rise past projections.
• The report concluded “the best course for Santee Cooper’s future energy generation – regardless of who owns or runs it – is retiring uneconomic coal plants on a reasonable schedule, and replacing that energy with clean renewable resources.”

Read the full report online >>>>

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For more than 30 years, the Southern Environmental Law Center has used the power of the law to champion the environment of the Southeast. With more than 80 attorneys and nine offices across the region, SELC is widely recognized as the Southeast’s foremost environmental organization and regional leader. SELC works on a full range of environmental issues to protect our natural resources and the health and well-being of all the people in our region. www.SouthernEnvironment.org

The Coastal Conservation League is a nonprofit advocacy and conservation organization whose mission is to protect South Carolina’s natural landscapes, abundant wildlife, clean water and quality of life by working with citizens, local government and the state legislature. Learn more and get involved at www.coastalconservationleague.org. Celebrating 30 years — 1989 to 2019.