Tuesday, Feb. 19, 2019
COLUMBIA, S.C. (AP) — For more than 700,000 customers of a private South Carolina utility, the $1,000 rebate checks aren't in the mail.
A year ago, Dominion Energy proposed writing the average South Carolina Electric & Gas customer a $1,000 one-time cash payment if lawmakers facilitated and regulators approved their merger. They spent millions of dollars touting the checks in ads that seemed to run on every TV newscast and local show.
During merger negotiations, Dominion executives, consumer groups, and regulators decided on lower power rates over 20 years by roughly $20 a month instead of the rebate. They said it would be a bigger benefit over a much larger period of time than the one-time payment.
But those $1,000 checks remain burned in the minds of many customers, and Dominion finds itself doing another advertising blitz over the next several weeks, this time introducing the Virginia-based company to its new South Carolina customers and explaining to them that the checks aren't coming.
"We understand some customers will be disappointed that refund checks are not included in the final approved plan, but we believe customers and South Carolina will benefit from the lower payments," Dominion spokeswoman Rhonda Maree O'Banion said in an email.
Some lawmakers, especially those who represent poorer districts, feel like Dominion pulled a bait-and-switch on their constituents, pushing hard to get support among African-Americans, then backtracking on promises. The original ads touting the rebates urged viewers to call their legislators and give their support for the merger.
"It seems that you were trying to advertise to the black community to impress upon us on this $1,000 charity," said Democratic Sen. Margie Bright Mathews of Walterboro told Dominion officials attending a meeting of the Black Legislative Caucus.
"Your first order of business was to get a couple of black lobbyists and go to black colleges and advertise in black medium radio," she said.
SCE&G's parent company, SCANA Corp., was looking to sell because it spent $5 billion on construction and design of two nuclear reactors that never generated a watt of power. South Carolina law allowed the utility to put all that debt on the backs of its customers, although the merger deal cut the customers' share of that debt about in half, leading to the monthly reduction in bills.
But the lower bills might not last for long. Dominion can ask for a rate increase for its base costs of generating and distributing power at the start of 2021. Old SCE&G customers haven't seen the base costs for power increase since 2012, even though there were several rate hikes to pay for the failed nuclear plants.
Consumer advocates warn that any such increase could be massive and if the rebates had been paid, electric bills would have ended up even higher without any monthly relief.
"In the longer term, it was more important people pay lower rates," said Frank Knapp, president of the South Carolina Small Business Chamber of Commerce and a frequent critic of SCE&G's management.
The hearings on additional rate changes will start in 2020.
In the meantime, there doesn't appear to be any effort among a majority of lawmakers or regulators to revisit the terms of merger and the possibility of rebates, although the Public Service Commission has asked Dominion to explain exactly what it is doing to tell customers there was a change in plans.
Democratic Rep. Wendell Gilliard of Charleston said the bad taste over no rebates has left some of his constituents asking if anything with the power company will change even with SCE&G and SCANA out of the picture.
"Dominion is coming in on the same tide that SCANA left out on," Gilliard said. "That's not good."