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SCE&G files lawsuit challenging new law’s constitutionality

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After signaling its intent to fight a newly passed state law temporarily lowering its customers’ bills, SCE&G filed a lawsuit challenging that law’s constitutionality.

S.C. Electric & Gas, principal subsidiary of Cayce-based utility SCANA Corp., asked a federal court Friday for an injunction (.pdf) preventing the S.C. Public Service Commission from implementing a temporary 15% reduction in rates charged to customers related to the failed V.C. Summer nuclear project.

The abandoned twin nuclear reactors at the V.C. Summer nuclear power plant. (Photo/High Flyer)

The PSC voted Monday to enact the rate cuts, which would last only until December, when the state regulatory committee is slated to make a final decision on who should pay for the abandoned project.  On Tuesday, the PSC ordered (.pdf) that the new rates begin with SCE&G's first August billing cycle. The order also mandates credits reflecting the 15% cut for customers' bills in April, May, June and July.

That would mean a monthly rebate of approximately $22.37, the PSC said. 

Bills implementing the rate reduction and delaying PSC action on a proposed merger between SCANA and Virginia-based Dominion Energy passed the S.C. House and Senate on Wednesday. Gov. Henry McMaster vetoed H.4375, which largely repealed the controversial 2007 Base Load Review Act, but that veto (.pdf) was swiftly overridden by a 39-0 count in the Senate and 110-1 in the House.

The BLRA allowed SCANA to ask for and receive nine rate increases during the 10-year construction of the reactors, abandoned last July after a series of rising costs and project delays. McMaster had promised to veto legislation that did not eliminate the entire 18% increase in SCE&G customer rates related to the V.C. Summer project.

In the lawsuit (.pdf), SCE&G claims that the rate reduction and other aspects of the new law “constitute an unlawful taking of private property, deny it due process of law, and constitute an unlawful bill of attainder, all in violation of various provisions of the United States Constitution.”

“Bowing to extreme political pressure, the South Carolina General Assembly now wishes that it had not enacted the BLRA and, through two new laws ... seeks to punish SCE&G by retroactively eliminating all rate increases since 2010 authorized under the BLRA,” the suit says. “The General Assembly’s actions are unconstitutional, violate SCE&G’s constitutional rights, and impermissibly interfere with interstate commerce.”

The suit says it seeks review of only the new legislation, not rulings by the PSC or any other state agency.

“If the Court does not grant immediate relief, SCE&G will suffer massive and irreparable harm, including millions of dollars in damages that cannot be recovered, a substantial loss of goodwill, and other permanent injuries,” the suit says.

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