Legislators have been busy since two utilities abandoned two nuclear reactors last July. But they haven’t discussed, with any seriousness or urgency, the one meaningful reform most likely to protect ratepayers in the future—deregulating the energy market.
House and Senate committees have advanced proposals to institute new safeguards on behalf of ratepayers.
The proposals follow months of hearings to understand how project partners, South Carolina Electric and Gas and state-owned Santee Cooper floundered their way through more than $2 billion in rate hikes to fund the now-abandoned project, costing roughly $9 billion to date.
Many of the proposals, which aim to improve accountability and prevent utilities from charging ratepayers more for the project, are good measures. But the General Assembly, in all its fanfare as the knight in shining armor, has missed this opportunity to protect the consumer by failing to allow competition.
All the restructuring in the world won’t protect ratepayers the way that competition will.
More than 60% of the country uses a market-based system, saving $3 billion annually, one University of Chicago researcher found in a January study.
Twenty-nine states and the District of Columbia have deregulated energy markets—either gas, electric, or both.
Sixteen of them have lower average rates than South Carolina, which has the third highest electric rate in the South.
Sen. Sean Bennett, R-Summerville, indicated he might support considering deregulation in the future.
If not today, when?
I fear that winding proposals into a more detailed regulatory structure could be a barrier to deregulation—and potential cost savings—in the future, at best.
Officials are attempting a legislative solution that layers on more government and regulation, which failed to protect customers in the first place.
To the Legislature’s credit, both chambers advanced measures to repeal parts of the 2007 Base Load Review Act, which is recognized as a contributing factor to the mess we’re in.
The House is set to take up a measure to repeal parts of the law, making it unusable going forward.
Any meaningful reform should address this law, which made it easier for utilities to hike rates to fund projects.
But let’s not miss the chance to do more than mere damage control and to help ratepayers in the years to come. Now is the time.