SC's nuclear fiasco opens the door for competing pipeline builders | Business

COLUMBIA – South Carolina's nuclear waste could become a boon for natural gas, offering some of the largest energy companies in the country the opportunity to tax Palmetto State's utility customers the cost of building pipelines worth billions of dollars.

That could bring more money to customers of S.C. Electric & Gas and Santee Cooper, who have already spent billions of dollars on a pair of abandoned nuclear reactors.

The parent company of SCE & G, SCANA Corp. and Santee Cooper failed to expand the V.C chain of stores. The summer nuclear plant has created a real gold rush for energy giants who are building large pipelines in West Virginia and seeking to conquer the natural gas market in the Carolinas.

Two major utilities, seeking to expand their presence in South Carolina, plan to charge customers from other states for the construction of a gas pipeline.

Dominion Energy, the co-owner of the Virginia-based Atlantic Coast pipeline, has already stepped up with the proposal to take over SCANA, which serves more than 700,000 customers in the Midlands and Lowcountry. Dominion's partner in this pipeline is Duke Energy, the state's largest utility, which provides electricity to 922,000 customers in the Pee Dee and Upstate areas.

At the same time, NextEra Energy, which holds stakes in the competing Mountain Valley Pipeline pipeline, proposed to buy SCANA's North Carolina natural gas service at the end of last year and could to be a suitor for the whole society if the utility authorities of South Carolina refused the takeover of Dominion, worth $ 14.6 billion. The Florida-based company is also widely perceived as a possible buyer for Santee Cooper, a public company.

No interstate pipeline project currently plans to expand to South Carolina. But the two companies are heading south as competing energy companies try to lock their customers and power plants in the state of Palmetto.

Any pipeline extension proposal in South Carolina could put hundreds of thousands of taxpayers on the shelves for increasing project costs and promoters' intrinsic profit margins. Dominion, for example, plans to recover the costs associated with the construction of its Virginia pipeline.

At present, South Carolina's legislation does not require state utility regulators to consider the need for a pipeline project prior to its construction. They only start to weigh when gas begins to flow and utilities seek to recover the cost of this fuel from taxpayers.

As a result, advocates representing the Southern Alliance Conservation League for Clean Energy and Coastal Protection have pushed utilities regulators this month to strengthen customer protection. They want the public service commission to look at the need for new pipelines right from the start and look at whether they are the cheapest options for taxpayers, instead of leaving that to the federal government.

"In the aftermath of the VC Summer fiasco, this commission should be wary of increasingly common utility practices that allow them to exploit captive customers," said Greg Lander, expert witness of the Southern Alliance for Clean. Energy.

Pushing pipelines

Ten years ago, nuclear energy was considered the best option to replace polluting coal-fired power plants, as natural gas prices were on the rise.

But projects like V.C. The summer in Fairfield County has been difficult, as no new nuclear power plants have been built in more than 30 years in the United States and no new reactors have been tested. Meanwhile, natural gas prices have fallen.

SCANA's two nuclear reactors in South Carolina were canceled last summer as part of a frantic race to build new gas pipelines in West Virginia and Pennsylvania, where hydraulic fracturing – commonly known as fracturing – it's open, while gas reserves inaccessible before.

Many energy companies have sought to take advantage of interstate pipelines that would bring billions of cubic feet of gas from the Marcellus Shale region to more populated areas of the country.

Together, Dominion and Duke hold 95% of the $ 6.5 billion Atlantic Coast Pipeline that will cross Virginia and North Carolina before ending 12 miles from the Carolina border. South near Lumberton, NC

NextEra holds a 31% interest in the approximately $ 5 billion Mountain Valley Pipeline, which is now expected to be completed in North Carolina, just west of Durham. Both proposed pipelines are expected to be completed by 2019.

No projects are currently configured to be integrated with the Palmetto state, but this could change quickly if SCANA or Santee Cooper were sold.

Dan Weekly, vice president of Dominon, admitted last year at an energy conference that "everyone knows" that the Atlantic Coast pipeline "will not end at Lumberton ". Dominion Chief Executive Thomas Farrell denied current plans to extend the pipeline last week, but he also admitted that this would be an option for his company in the future.

"There is no possibility that it will come here today," Farrell told South Carolina's utility regulators. "I hope it's coming."

NextEra officials declined to comment on this story.

O 'Neal Hamilton, one of the seven utility regulatory agencies in South Carolina, wants multi-billion dollar pipelines to be expanded in the state of Palmetto.

"We need all the tools of rural South Carolina to contribute to economic development," Hamilton said at a hearing on Nov. 15.

Critics of the pipelines, however, say that South Carolina's utility regulators should pay attention to what they want.

They pointed to Virginia, where Dominion signed an agreement that could make taxpayers pay the cost of a pipeline in the decades to come.

Looking behind the contracts?

The legal battles surrounding the Atlantic Coast and Mountain Valley pipelines have focused on one issue: have companies proven that hundreds of kilometers of gas pipeline are really needed?

In split decisions, the Federal Energy Regulatory Commission approved the construction of the two gas pipelines last year, after spending months looking at multi-billion dollar projects .

Pipeline developers said the projects were needed to adequately supply growing areas of the country and to prevent price spikes when natural gas demand was at its peak.

Critics argue that companies have not really proven the lack of natural gas supply.

Federal energy regulators, they said, voted in favor of building on the "auto-negotiation" contracts that NextEra, Dominion and Duke signed with their own subsidiaries – including the monopolistic public services they own in Virginia and North Carolina.

In doing so, opponents – including Ken Cuccinelli, former Virginia Republican Attorney General – argue that the Federal Energy Commission handcuffed taxpayers to expensive pipeline projects without really assessing whether they were needed or not. The least expensive option.

Dominion spokesman Aaron Ruby said his company had spent years internally reviewing other pipeline companies' offerings before deciding to build the Atlantic Coast pipeline itself. Federal regulators, he said, would not have given Dominion and Duke permission to build the Atlantic Coast pipeline unless they determined they were a " public need ".

The federal energy commissioners, however, admit in their orders that they have never fully explored the energy needs of each utility that served to justify the pipeline. These regulators say they were not forced to take a look behind the contracts, even if they were signed between two affiliated companies.

Will Cleveland, a Southern Alliance Advocate for Clean Energy and Coastal Conservation, said it may be too late for customers in Virginia and North Carolina to consider the need for pipelines .

But South Carolina's leaders, he said, may still require further scrutiny before the Atlantic coast or another pipeline is extended into the state.

The Office of Regulatory Staff, South Carolina's utility watchdog, is asking the Public Utilities Board to do just that. They want the state to play a bigger role in determining whether the pipeline is best for customers.

But Dominion categorically opposes the plan. Farrell, the company's CEO, said last week that any additional rules put in place for pipeline construction could cause Dominion to abandon its SCANA takeover plan.

Farrell similarly threatens the failure of the nuclear project.

He has said time and time again that Dominion will cancel the sale of SCANA if state regulators terminate payments by South Carolina taxpayers for unfinished reactors.