Duke Energy submits proposal to buy Santee Cooper

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Duke Energy has made its interest in purchasing state-owned utility Santee Cooper official, filing a proposal for the General Assembly to review.

The Charlotte-headquartered power company’s name had been floated as a possible suitor for the embattled state utility, along with Florida-based NextEra Energy and Greenville-based Pacolet Milliken. Companies faced a Jan. 14 deadline to submit purchase proposals.  

A Pacolet Milliken spokesperson confirmed that the investment company also submitted a bid.

The Electric Cooperatives of South Carolina, a trade association for Santee Cooper’s largest customer, Central Electric Power Cooperative, had previously expressed interest in acquiring Santee Cooper. A Central Electric Power Cooperative spokesperson confirmed the cooperative, a wholesale distributor that provides power to the state's 20 electric cooperatives, submitted two proposals.

In an emailed statement, Duke Energy spokesperson Ryan Mosier said: “Duke Energy has a keen interest in the economic vitality of South Carolina, given our more than 100 years of history in the state. The governor requested Duke Energy, along with other companies, evaluate options for a potential acquisition of Santee Cooper. After a thorough evaluation, Duke Energy has submitted a proposal through the state’s process for consideration. We look forward to understanding the next steps in the process and the state’s response to our proposal.”

An email to Gov. Henry McMaster’s office requesting comment on Santee Cooper purchase proposals was not immediately answered. 

Santee Cooper said it had no comment on the proposals.

 “The proposals were made to the Legislature,” Santee Cooper spokesperson Tracy Vreeland said via email. “We have no independent knowledge of who made proposals at this point.”

McMaster has been shopping Santee Cooper, saddled with $8 billion in debt and dealing with fallout from the failed nuclear reactor project at the V.C. Summer nuclear power station in Fairfield County. Santee Cooper owned 45% of the project, while S.C. Electric & Gas, formerly the principal subsidiary of Cayce-based SCANA Corp., owned 55%.

Half of Santee Cooper’s debt stems from the reactors, abandoned in July 2017 after a series of rising costs and mounting delays. McMaster has charged that Santee Cooper has acted in its own best interests, not its ratepayers’, in the V.C. Summer aftermath. Central Electric Power Cooperative sued Santee Cooper last February to prevent the utility from charging the state’s co-ops more for the failed project.

The S.C. Legislature would have to approve a Santee Cooper sale.

In January, Virginia-headquartered Dominion Energy completed an acquisition of SCANA. The Richmond-based company has floated a management agreement in which it would oversee certain administrative functions for Santee Cooper but has repeatedly said it is not interested in buying the utility.

Dominion spokesperson Ryan Frazier told the Columbia Regional Business Report earlier this month that transferring control to a private company would result in higher rates for customers, in part because Santee Cooper would forfeit its tax-exempt status and lose the high bond rating driven by its state ownership.

Frazier did not immediately return a message Friday.