Nuke Bailout

Dave Schwartz, Freedom Action Network

Nuke Bailout, How did this happen?

Nuke Bailout

Bob McLain
August 09, 2017 - 2:00 pm
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Today I turn my blog post over to my friend Dave Schwartz, head of Freedom Action Network of South Carolina for his Op-Ed on the looming taxpayer disaster that is the Nuclear Reactor bailout.

Nuclear bailout – how did this happen?

 

To call our energy situation in South Carolina a mess would be the understatement of the decade.  For the last ten years, our electricity bills have skyrocketed.  We’ve been forced to pay rate hike after rate hike.  And, we have no choices when it comes to buying electricity in South Carolina. 

 

As if it couldn’t get any worse, we were told last week that utility company South Carolina Electric & Gas (SCE&G) and taxpayer-owned partner Santee Cooper will abandon their incomplete nuclear power plant in the Midlands, even after sinking nearly $10 billion into the project.

 

And not to exclude Upstate ratepayers, this week Duke Energy floated the idea that they might also give up on a similar, but smaller unfinished project in Cherokee. 

 Ratepayers across the state have been subsidizing the up-front construction of these power plants.  In the case of SCE&G and Santee Cooper, we’ve already been forced to pay them $1.4 billion (with a “b”) – roughly 20% of our current monthly electricity bill. 

 

Now that they’ve have walked away from the failed projects, the utilities want a ratepayer-funded bailout for all of their costs. 

 

You read that correctly.

 

We we’re forced to pay billions for the upfront construction costs and debt service.  We’re going to be forced to pay billions more to bail them out for a failed project. Utility companies will walk away virtually unharmed.  And we won’t get a single watt of electricity in return.

Forget the 72% gas tax hike – this abomination may be the biggest boondoggle and greatest transfer of wealth in state history.

 

So, who is to blame for this mess? 

 

State politicians in Columbia.

 

They control the energy system from top to bottom.

 

Thanks to a bailout law that lobbyists and state legislators wrote and rushed to pass a few years back called the “Base Load Review Act (BLRA),” ratepayers were unknowingly made the guarantor on these nuclear power plants.

 

Not only did state legislators force us to pay the up-front debt to construct these projects, but they also left us on the hook to bail out the utility companies when the project fails. 

 With powerful politicians on their side, utility corporations had no motivation to finish on time and under budget.  Heck, if all else failed (which it has), the politicians and their lobbyists wrote a law to bail them out. 

 

Since the law passed, their profits grew and the stock prices went up.  Who wouldn’t invest or lend money to a company that can’t lose?

 

That attitude also filtered down to the construction management team at the project site.  Workers on the ground called it a “gravy train” culture.  They quickly understood that the ratepayer money was endless, so work product and schedules were not a concern.

 

Thanks to state politicians and the system they concocted, unfortunately for us, the workers were right.

Legislators set up the classic scheme: socialize losses and privatize profits.  In the end, working folks always lose.  The politicians screwed us badly.

 

The Public Service Commission (PSC) is the bureaucracy that determines our electricity rates.  In the last ten years they’ve approved nine consecutive rate hikes.  Commissioners have already hinted they will comply with the BLRA law and likely raise our prices again before the end of this year.  In the case of SCE&G customers, we’re looking at a $5 billion bailout.

 

Guess who appoints the PSC?  You guessed it, state legislators.

 

So what can citizens do to fight back?

 

First, we must pressure state politicians to fully repeal the bailout law (the Base Load Review Act) to give us a fighting chance to stop future rate hikes and ensure this never happens again.

Some politicians want to convene a “special legislative session” in Columbia next month to address this debacle.  Wasting more of our time and money to do the lobbyist’s bidding behind closed doors will only make matters worse.

 

However, if, and only if they want a full, clean repeal of the bailout law, then they should convene quickly for a vote.  No “skinny repeals,” no fake reforms, no behind-closed-doors deals, and no compromises.  A simple repeal.

 

You can send your politician that message by texting the word REPEAL to the number 52886. 

 

Future reforms that will empower consumers with more choices and freedom are the only way we will ever solve root of the problem.  State politicians need to be taken out of the equation.

Remember, the state legislature created this mess.  But unless an angry, organized group of ratepayers hold them accountable, expect higher bills and more bailouts for our kids and grandkids.

 

Dave Schwartz is the President of Freedom Action Network of South Carolina (FAN of SC), an organization that empowers citizens to fight corruption, take control of their government and advocate for freedom.  He can be reached at dave@fanofsc.com.

 

 

WHO SUPPORTED THE BAILOUT LAW IN 2007 AND STILL HOLDS OFFICE TODAY

Sen. Thomas Alexander (R-Oconee)

Lt. Gov. Kevin Bryant (R-Anderson)

Sen. Chip Campsen (R-Charleston)

Sen. John Courson (R-Richland

Sen. Ronnie Cromer (R-Newberry)

Sen. Greg Gregory (R-Lancaster)

Sen. Larry Grooms (R-Berkeley)

Sen. Brad Hutto (D-Orangeburg)

Sen. Darrell Jackson (D-Richland)

Senate Leader Hugh Leatherman (R-Florence)

Sen. John Matthews (D-Orangeburg)

Sen. Harvey Peeler (R-Cherokee)

Sen. Luke Rankin (R-Horry)

Sen. Glen Reese (D-Spartanburg)

Sen. Nikki Setzler (D-Lexington)

Sen. Vince Sheheen (D-Kershaw)

Sen. Danny Verdin (R-Laurens)

Sen. Kent Williams (D-Marion)

Sen. Karl Allen (D-Greenville

Sen. Scott Talley (R-Spartanburg)*

Sen. Mike Gambrell (R-Anderson)*

Rep. Jimmy Bales (D-Richland)

Rep. Nathan Ballentine (R-Lexington)

Rep. Bruce Bannister (R-Greenville)

Rep. Eric Bedingfield (R-Greenville)

Rep. Alan Clemmons (R-Horry)

Rep. Bill Clyburn (D-Aiken)

Rep. Gilda Cobb-Hunter (D-Orangeburg)

Rep. Greg Delleney (R-Chester)

Rep. Bill Herbkersman (R-Beaufort)

Rep. David Hiott (R-Pickens)

Rep. Chip Huggins (R-Lexington)

Rep. Joe Jefferson (D-Berkeley)

Rep. Phillip Lowe (R-Florence)

Speaker Jay Lucas (R-Darlington)

Rep. Harold Mitchell (D-Spartanburg)

Rep. Dennis Moss (R-Cherokee)

Rep. Mike Pitts (R-Laurens)

Rep. Bill Sandifer (R-Oconee)

Rep. Gary Simrill (R-York)

Rep. Garry Smith (R-Greenville)

Rep. Murrell Smith (R-Sumter)

Rep. Kit Spires (R-Lexington)

Rep. Leon Stavrinakis (D-Charleston)

Rep. Mac Toole (R-Lexington)

Rep. Brian White (R-Anderson)

Rep. Bill Whitmire (R-Oconee)

 

*Currently serves in the Senate, voted for BLRA as a member of the House

 

 

 

 

 

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