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SC utilities balk at federal renewable-energy bill
By Molly Parker
Staff Writer
Arguing that a one-size-fits-all approach is unfair because the availability of renewable resources differs across the nation, the electric utilities serving South Carolina prefer that individual states set renewable-energy portfolio standards rather than the federal government.
“An all-encompassing federal mandate may not address the concerns we have here specific to South Carolina,” said Robert Yanity, spokesman for Columbia-based SCANA Corp., parent company of South Carolina Electric & Gas, which serves roughly 630,000 urban electric customers in the southeast corner of the state.
Yanity was referring to the energy bill passed Aug. 4 by the U.S. House that would mandate investor-owned utilities by 2020 obtain at least 15% of their energy from renewable sources or through efficiency programs.
The static requirement fails to account for the fact that southeastern states such as South Carolina are geographically hindered in collecting enough wind and solar energy to make a significant dent in the state’s power grid, he said.
The U.S. Senate’s previously passed version of the energy bill does not include the renewable-energy standard, and it’s unclear if the controversial measure will survive negotiations between the chambers.
Still, the House vote, coupled with the growing number of states setting their own renewable-energy standards, signals the increasing pressure on consumers and corporations to tap green sources and conserve energy.
“We do fully support reducing emissions,” Yanity said, but added that the company would rather see the establishment of non-emission standards as opposed to a mandate on the use of renewable energy. That would allow the company to count its nuclear energy production, which currently makes up roughly 19% of its portfolio.
A spokesman for Duke Energy, which services roughly 600,000 electricity customers in the Upstate, pointed to recently passed legislation in North Carolina, where the company is headquartered, as an example of how states can responsibly set renewable-energy portfolio standards.
The measure would require utilities to ensure that 12.5% of its electricity comes from renewable sources by 2021. Energy-efficiency programs would also count toward that goal, and cost caps would be established, negating the requirement if the price to produce the electricity exceeds defined benchmarks, said Tom Williams, the company’s director of energy policy for communications.
If signed into law by Gov. Mike Easley, North Carolina will join 23 states and the District of Columbia in establishing renewable-energy standards, though it will be the first to do so in this corner of the country, said Dan Riedinger, spokesman for the Edison Electric Institute, the trade association that represents shareholder-owned electric companies and whose members are responsible for 70% of the U.S. power supply.
The federal standard, if passed, he said, would be stricter than two-fifths of the state laws, including North Carolina’s.
Riedinger also criticized the alternative written into the legislation for companies that could not meet the standards: They would be required, he said, to pay a fee to the government or to buy credits from companies that exceed the benchmarks.
“It’s essentially a wealth transfer from those (utility companies) that lack to those that have, due to huge regional disparities and resources,” he said.
Still, supporters of the bill argue a federal standard is the only way to get lagging states to cooperate.
Nicholas Rigas, director of the S.C. Institute for Energy Studies at Clemson University, said similar efforts have been stalled here by concerns such standards could pass undue costs onto customers and break an already fragile industrial base.
“South Carolina is going to be one of those states that are the last to go or be pulled by a federal mandate,” he said.
Rigas suggested coastal companies look toward offshore wind farming even though it is much more expensive than harnessing the wind on land. “I think the public needs to realize that in the future, cheap energy will be a thing of the past. We’re going to have to pay for it one way or another.”
To their credit, Rigas said, regional companies have begun pitching creative solutions.
Duke Energy is currently seeking state approval of an array of programs driven by new technologies in North Carolina to aggressively expand energy efficiency, Williams said. As an example, the company would like to employ an air conditioning load program, in which air conditioners would be automatically shut off during the day in spurts for a short period of time during peak hours.
If approved, Duke plans to ask the Public Service Commission of South Carolina for permission to roll out a similar program here.
Progress Energy, which serves 171,685 customers in the northern part of the state, is also working on a pilot project in its home state of North Carolina to turn hog waste into home energy, said Dana Yeganian, the company’s environmental and policy communications specialist.
In a partnership with Santee Cooper, the state’s public utility, SCE&G plans to build another nuclear plant by 2016 in Jenkinsville near the existing V.C. Summer Nuclear Station.
Molly Parker is a staff writer for the Business Journal. You can e-mail her directly
at mparker@charlestonbusiness.com.
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