Rally With Us Against Duke’s 15.1% Rate Hike

May 2^nd—9AM—Charlotte

Thursday, May 2^nd, Duke Energy holds its Annual Shareholder Meeting to explain how it plans to increase electricity rates to make more money.

Outside the building residential and small business ratepayers will explain how we plan to stop Duke’s average 15.1% rate hike in South Carolina.

Come join ratepayers from the South Carolina Small Business Chamber of Commerce, AARP-SC, Consumers Against Rate Hikes and many other organizations who are standing up against being gouged by Duke Energy.  The company just had a 6% rate hike earlier last year.  Another 15.1% would mean a 21% increase to us in a little more than a year!

Raise your voice with us at 9AM this Thursday, May 2^nd, at 526 S. Church Street in Charlotte. 

The fight against this Duke rate hike starts Thursday.  Let the company know that you are willing to stand so that their rate increase will not.

Please call us with questions at 803-252-5733.

Thank you for your support.

Frank Knapp Jr.
President & CEO
South Carolina Small Business Chamber of Commerce

SCE&G asks customers to pay for employee Zumba classes, expensive dining and alcohol for SCANA Board

                                      Expenses called “Appalling and Offensive”

Columbia, SC—With many South Carolinians still struggling to simply put food on the table and small businesses trying to keep their doors open, South Carolina Electric & Gas (SCE&G) wants its 668,000 customers to pay an average 6.6% increase in electricity rates.  SCE&G justifies its need for an increase in revenue in part because of “Zumba and body sculpt classes” for its employees as well as dinner and drinks at an expensive restaurant for SCANA Board members.  This public information was released today by the South Carolina Small Business Chamber of Commerce that opposes the rate increase.

On June 29, 2012, SCE&G filed for a general rate hike that calls for residential customers to pay 7.35% more for electricity while businesses would pay 4.19% to 6% higher rates.  The new rates on their own would bring in about an additional $151 million to the company.  SCANA, parent company of SCE&G, reported a 29% increase in earnings to $72 million in the second quarter this year compared to last year.

The documents provided to the S.C. Office of Regulatory Staff (ORS) to justify the rate hike show that SCE&G paid nearly $3200 for 166 “Zumba and body sculp” classes for employees from a private trainer in 2011.  This company expense was just part of the $1.4 million in unallowable expenses found by the ORS.  SCE&G also wants its customers to pick up the tab for dinners and drinks at Ruth’s Chris Steak House in Columbia for the SCANA Board members.  Those bills showed $593 of liquor at a January 2011 dinner and a $643 alcohol tab at the same restaurant in August 2011.  Included in those drink charges were four Macallan 25 Scotches at $50 each and five $56-bottles of wine.

“Asking the SCE&G customers to pay for Zumba classes and alcohol is appalling and offensive,” said Frank Knapp, Jr., president and CEO of the South Carolina Small Business Chamber of Commerce.  Mr. Knapp has formerly intervened in the SCE&G rate case as a private customer as he has done four times before.

“While these costs are small compared to the total revenue sought by SCE&G,” Knapp continued, “the company knows that they are absolutely unallowable expenses to be included in a rate case.  Several years ago SCE&G tried to include the cost of massages and ORS rightfully threw that out.”

“Intentionally including these costs to justify a rate hike demonstrates a blind-eye toward their customers’ economic struggles,” said Knapp.  “Just going out for a family dinner is out of reach for many SCE&G customers because they have so many other bills they must pay, like the electric bill, which for SCE&G residential customers is already 22% higher than Duke customers and 28% more than Progress Energy customers.”

Knapp added, “Every unnecessary dollar paid by a residential customer to SCE&G is a dollar that won’t be spent in a local small business to help grow the economy.  And every unnecessary dollar paid by a small business to SCE&G is a dollar that can’t be used for paying higher wages to workers.  This issue is not just about keeping SCE&G financially healthy.  It’s about how to do that without hurting the state’s economy by asking consumers to pay more than is absolutely necessary.”

At the rate hearing set for November 27, Mr. Knapp will also challenge SCE&G’s rate hike request for a much higher Return on Equity (ROE) than the rate Duke Power currently has.  “SCANA is a profitable company because our regulators make sure that it is.  Wall Street doesn’t need anywhere near the 10.95% ROE that SCE&G is asking for in order to entice it to buy the company’s paper.  Wouldn’t we all like to get even 10% return on our investments,” asked Mr. Knapp.

(Supporting documents and Mr. Knapp’s full statement can be found at www.scsbc.org under issues.)

SCE&G wants more of your money

For those of you in the South Carolina Electric & Gas (SCE&G) territory, get ready to mark your calendars.  The power company is asking for an overall rate increase of 6.6% on electricity for its 660,000 customers.  For small businesses the rate hike would be 4.19% and residential customers would pay a whopping 7.35% more for electricity.  The total new money being sought from customers by SCE&G with this filing is $151.5 million.

This rate hike has nothing to do with the SCE&G construction of the two nuclear reactors under cosntruction that they are also requesting another $238 million from their customers.  And this has nothing to do with regular fuel adjustments.  This is all about regular operational costs for SCE&G.

Is the increase justified?  We’re going to find out because the S.C. Public Service Commission (PSC) will hold its hearing on the matter right after Thanksgiving.  I have formerly intervened in the process which gives me the right to cross examine all witnesses.  I have done this numerous times in the past and at the end of the day SCE&G proposed rate increases have been knocked down by up to 50%.

So what’s the prognosis this time?  Here are some facts.

--SCE&G already has the highest rates of the commercial power companies in South Carolina.  The average monthly residential bill for a 1000 kWh customer is $130.64 for SCE&G, $106.77 for Duke and $101.58 for Progress.

--SCE&G is asking to increase its return of common equity (the rate offered to Wall Street financiers to entice them to by SCE&G paper) from 10.7% to 10.95%.  This would be 0.45% higher than what Duke has been given by the PSC. 

--The parent company of SCE&G, SCANA, had a 29% increase in earnings in the second quarter of this year compared to the same period the year before.  That means that SCANA took in $72 million in profit in May, June, and July this year. 

If you want to let the PSC know how you feel about the proposed SCE&G rate hike, there are three public hearings.  All public hearings will start at 6 pm.

--Wednesday, October 24^th, at the Aiken Technical College, Amphitheater (Room 701), 226 Jefferson David Highway, Graniteville, SC.

--Monday, November 5^th, International Longshoremen’s Association Local 1422, 1142 Morrison Drive, Charleston, SC.

--Tuesday, November 27^th, Public Service Commission of South Carolina, 101 Executive Center Drive, Columbia, SC.

You can check out the SCE&G filing (NO. 2012-218-E) at the PSC website, www.psc.sc.gov.  If you would like to comment by mail, send it to SC Office of Regulatory Staff, 1401 Main Street, Suite 900, Columbia, SC  29201.