The Santee Cooper board of directors decided Monday to suspend efforts to permit the Pee Dee Energy Campus, a proposed coal-fired plant in Florence County.Santee Cooper spokesperson Laura Varn says the recession has had a severe impact on sales at the state-owned utility. “Our sales are down 5 percent and industrial sales are down 18 percent. That’s a major factor altering the long-term need for power.”
Varn says passage of the cap and trade legislation in the US House is another major reason. “It poses greater uncertainty for utilities looking to build coal-fired power plants. There are technology costs and also the carbon tax, which gives us greater pause moving forward.”
Also, the board sited the fact that Central Electric Power Cooperative, Santee Cooper’s largest customer, intends to gradually reduce its purchase from Santee Cooper by 1000 megawatts beginning in 2013. Central buys from the utility for individual power suppliers all over State Carolina–20 electric cooperatives in all 46 counties. Central currently intends to acquire that power from another supplier. The reduction would take place over a seven-year period.
The board directed its CEO to further evaluate the rapid changes in the power industry and how they will impact the utility’s future generation plan and report back to the board at a later date.
Gov. Mark Sanford, who appoints DHEC board members with the consent of Senate lawmakers, made a formal announcement opposing Santee Cooper’s proposal to build the $1.25 billion plant near Pamplico. Sanford’s move came just days after the state Department of Natural Resources officially announced its opposition to the plant, saying it poses unnecessary risks to the state’s environment and residents.
Also Monday, the Santee Cooper board approved the first phase of an average 3.4 percent base rate increase beginning November 1st, to offset rising costs of operating.
The board postponed adopting a second rate adjustment proposed for 2010. Varn says that decision is connected to the decision to suspend permitting for the Florence plant. “We need further analysis to determine how much we’ll need on that second adjustment,” said Varn.