SCE&G Files for Rate Adjustment Under Base Load Review Act
CAYCE, S.C., May 30, 2013 /PRNewswire/ — South Carolina Electric & Gas Company, principal subsidiary of SCANA Corporation (NYSE: SCG), today filed with the Public Service Commission of South Carolina and the South Carolina Office of Regulatory Staff for an overall 2.97 percent increase to its approved electric rates under provisions of a state law known as the Base Load Review Act, or BLRA. The BLRA effectively reduces the cost of building nuclear power plants in South Carolina by allowing the state’s regulated utilities to adjust rates annually during construction of such plants to recover related financing costs.
SCE&G and state-owned utility Santee Cooper are building two nuclear electric-generating units at the site of the V.C. Summer Nuclear Station near Jenkinsville, S.C. The most current publicly available estimated total construction cost and construction schedule are available in the Q1 BLRA filing on the SCANA investor relations’ website at www.scana.com/en/investor-relations/.
Paying financing costs while construction is ongoing, as opposed to waiting until the project has been completed, lowers the cost of building the new units by about $1 billion, which in turn reduces the amount customers will pay through rates for related costs such as the cost of capital, depreciation, property taxes and insurance associated with the project. SCE&G estimates this will save its customers approximately $4 billion in electric rates over the life of the new units.
If the PSC approves today’s filing, SCE&G’s approved electric rates would increase in October as follows:
- 3.10 percent for residential customers (the monthly bill of a customer using 1,000 kilowatt hours of electricity would increase $4.32, going from $138.11 to $142.43)
- 3.04 percent for small commercial customers
- 3.07 percent for medium commercial customers
- 2.66 percent for large commercial/industrial customers.
SCE&G is a regulated public utility engaged in the generation, transmission, distribution and sale of electricity to approximately 673,000 customers in South Carolina. The company also provides natural gas service to approximately 325,000 customers throughout the state. More information about SCE&G is available at www.sceg.com.
SCANA Corporation, headquartered in Cayce, SC, is an energy-based holding company principally engaged, through subsidiaries, in electric and natural gas utility operations and other energy-related businesses. Information about SCANA and its businesses is available on the company’s website at www.scana.com.
SAFE HARBOR STATEMENT
Statements included in this press release which are not statements of historical fact are intended to be, and are hereby identified as, “forward-looking statements” for purposes of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include, but are not limited to, statements concerning key earnings drivers, customer growth, environmental regulations and expenditures, leverage ratio, projections for pension fund contributions, financing activities, access to sources of capital, impacts of the adoption of new accounting rules and estimated construction and other expenditures. In some cases, forward-looking statements can be identified by terminology such as “may,” “will,” “could,” “should,” “expects,” “forecasts,” “plans,” “anticipates,” “believes,” “estimates,” “projects,” “predicts,” “potential” or “continue” or the negative of these terms or other similar terminology. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and involve a number of risks and uncertainties, and that actual results could differ materially from those indicated by such forward-looking statements. Important factors that could cause actual results to differ materially from those indicated by such forward-looking statements include, but are not limited to, the following: (1) the information is of a preliminary nature and may be subject to further and/or continuing review and adjustment; (2) regulatory actions, particularly changes in rate regulation, regulations governing electric grid reliability, environmental regulations, and actions affecting the construction of new nuclear units; (3) current and future litigation; (4) changes in the economy, especially in areas served by subsidiaries of SCANA; (5) the impact of competition from other energy suppliers, including competition from alternate fuels in industrial markets; (6) the impact of conservation and demand side management efforts and/or technological advances on customer usage; (7) growth opportunities for SCANA’s regulated and diversified subsidiaries; (8) the results of short- and long-term financing efforts, including prospects for obtaining access to capital markets and other sources of liquidity; (9) changes in SCANA’s or its subsidiaries’ accounting rules and accounting policies; (10) the effects of weather, including drought, especially in areas where the generation and transmission facilities of SCANA and its subsidiaries (the Company) are located and in areas served by SCANA’s subsidiaries; (11) payment and performance by counterparties and customers as contracted and when due; (12) the results of efforts to license, site, construct and finance facilities for electric generation and transmission; (13) maintaining creditworthy joint owners for SCE&G’s new nuclear generation project; (14) the ability of suppliers, both domestic and international, to timely provide the labor, components, parts, tools, equipment and other supplies needed, at agreed upon prices, for our construction program, operations and maintenance; (15) the results of efforts to ensure the physical and cyber security of key assets and processes; (16) the availability of fuels such as coal, natural gas and enriched uranium used to produce electricity; the availability of purchased power and natural gas for distribution; the level and volatility of future market prices for such fuels and purchased power; and the ability to recover the costs for such fuels and purchased power; (17) the availability of skilled and experienced human resources to properly manage, operate, and grow the Company’s businesses; (18) labor disputes; (19) performance of SCANA’s pension plan assets; (20) changes in taxes; (21) inflation or deflation; (22) compliance with regulations; (23) natural disasters and man-made mishaps that directly affect our operations or the regulations governing them; and (24) the other risks and uncertainties described from time to time in the periodic reports filed by SCANA or SCE&G with the United States Securities and Exchange Commission. The Company disclaims any obligation to update any forward-looking statements.
South Carolina Electric & Gas Company
Annual Request For Revised Rates
The Public Service Commission of South Carolina
Docket Number 2013-150-E Filing Period Projected Twelve Months Ended June 30, 2013 Requested Effective Date October 30, 2013 Requested in Application: Annual Revenue Increase $ 69.7 Million, 2.97% Incremental CWIP $ 590.4 Million Return on Common Equity 11.00%
Capital Structure and Cost of Capital:
Capital Ratio Embedded Weighted Average Gross of Structure Cost Cost of Capital Tax --- Long-Term Debt $3,629 46.32% 5.74% 2.66% 2.66% Common Equity 4,206 53.68% 11.00% 5.90% 9.60% ------------- ----- ----- ----- ---- ---- Total $7,835 100.00% 8.56% 12.26%
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SOURCE SCANA Corporation