Support intensifies for S.C. bill that aims to bolster state’s grid reliability

Published on April 23, 2024 by Kim Riley

© Shutterstock

Dominion Energy South Carolina and several others support a proposed bill in the South Carolina Legislature that they say is extremely important to grid reliability across the state.

The South Carolina Energy Security Act, H. 5118, which is sponsored by South Carolina Speaker of the House George Murrell Smith, Jr., a Republican representing District 67, aims to improve electric reliability in the state by having the General Assembly authorize construction of new energy generation. 

Specifically, H. 5118 would authorize Dominion Energy and Santee Cooper, South Carolina’s public power and water utility, to build a new fossil gas power plant on the Edisto River that would be jointly financed and owned by both companies. The project would require new interstate pipelines to bring the fossil gas in from out of state, as well as over 100 miles of upgraded electric power lines.

Similarly, the legislation also encourages Duke Energy, which serves the Upstate and Pee Dee regions of the state, to build new gas-fired power plants.

The South Carolina House of Representatives late last month voted 83-21 to approve H. 5118, which also passed the State Senate Judiciary Committee this month. The bill as early as this week could see movement on the floor of the South Carolina Senate, sources say.

Both Dominion Energy and Santee Cooper are gungho about H. 5118.

Dominion Energy’s Rhonda Maree O’Banion, director of media relations and video communications, told Daily Energy Insider that since South Carolina became the fastest growing state in the nation in 2023, the utility expects customers’ energy demands to continue to grow as new jobs and industry attract new residents and supporting businesses to the state. Passage of the bill would help Dominion support this growth, O’Banion said.

“The South Carolina Legislature’s attention to the critical need to modernize the state’s electric grid, increase generation, and replace coal with increasingly clean energy underscores the importance of this matter,” O’Banion wrote in an email, adding that Dominion Energy intends to end reliance on coal as a fuel source in South Carolina as early as possible while providing reliable, affordable and increasingly clean energy every day.

“The optimum replacement for coal generation is a large, highly efficient natural gas-fired combined cycle resource jointly owned with Santee Cooper,” wrote O’Banion. “Natural gas generation is required to support reliability and supply low-cost energy for our customers. 

“In short, reliable and operationally flexible natural gas generation resources are key to supporting the addition of non-dispatchable, intermittent renewable resources,” she wrote.

O’Banion also pointed out that H. 5118 would ensure the state’s regulatory process doesn’t allow unnecessary and costly delays in the construction of natural gas generation in South Carolina. 

“Building a joint resource could create economies of scale, which could reduce costs to customers, including the electric cooperative utilities Santee Cooper serves,” according to her email. “It could also enhance efficiencies in natural gas pipeline expansions and reduce the environmental footprint needed to replace coal generation on both systems.”

Constitutionally, added O’Banion, the South Carolina Legislature must act in order for state-owned Santee Cooper to partner with Dominion Energy. 

“Otherwise, it is likely that there will be two separate gas plants with twice the footprint, which means more costs for customers,” she wrote.

Jimmy Staton, president and CEO of Santee Cooper, also said the bill would enable his company to close down coal plants sooner, and noted that natural gas is the most common and cost-effective form of generation available today.

“Specific to Santee Cooper, adding a gas resource may allow us to close coal plants sooner and to reduce our emissions by over 50 percent,” Staton testified during a Feb. 27 State House Labor, Commerce, and Industry Committee hearing. “South Carolina needs an energy mix that’s reliable and affordable to meet the needs of the people who live here and to support the incredible economic prosperity that you all have created. We need a more diverse energy mix and right now that has to include an additional natural gas generation.”

“This bill supports allowing us to build the plant in the lowest cost, least-risk way possible,” he added.

Staton also countered critics who tout battery storage as a substitute for natural gas and said that solar battery storage currently is limited in duration and relies on other energy resources.

“Quite frankly, it’s inadequate and expensive as a backup,” he testified. “We need battery storage to improve and I believe over time it will indeed improve. Costs will come down. But… I’m not willing to bet the reliability of the Santee Cooper grid on something that I hope will get better over time when I have a proven resource that I can bring to the table right now.”

He added that batteries are in the company’s long-term plan and “we will be bringing them to the Santee Cooper system as they become practical.”

Brad Viator, CEO of B Strategic, a consulting firm in Washington, D.C., agreed that H. 5118 will help South Carolina meet its rising energy demands.

“South Carolina, like much of the rest of the Southeast, is experiencing a manufacturing and data center investment renaissance,” Viator told Daily Energy Insider. “To meet that need, the state needs more energy supply.”

The legislation also will ensure the process of investing in dispatchable natural gas has an expedited permitting timeline, he said. 

“That is key to getting new resources developed,” said Viator, noting that the focus on getting approval for specific plants is also critical and will have a positive impact on both Dominion Energy and Santee Cooper.

The Council for Citizens Against Government Waste (CCAGW) agreed, saying the bill specifically would streamline the regulatory appeals and approval processes for applications to build new energy transmission infrastructure. 

Under current law, requests to expand transmission lines are subject to a complex, multi-year permit review process, according to CCAGW President Tom Schatz, who said the resulting delays strain existing lines and lead to overloads, blackouts, brownouts, and equipment damage.

“South Carolina’s strong economic growth has led to growing demand for electricity on the state’s limited and aging transmission infrastructure,” Schatz wrote in a Feb. 27 letter sent to South Carolina legislators. “Ensuring reliable power delivery, optimizing power flow, managing demand, and avoiding disruptions require upgrades that will expand throughput and integrate smart grid technologies.”

If enacted, H. 5118 would provide an expedited permit review that would reduce costs and limit the review process from a maximum of four years to six months and shorten the appeals process by providing for direct appeal of Public Service Commission (PSC) decisions to the South Carolina Supreme Court, added Schatz. 

Finally, he said the bill would guarantee public participation in the application process by granting electrical utility customers the right to address the PSC as public witnesses and would establish a fixed timeline for testimony and discovery in contested proceedings before the PSC, bringing efficiency, predictability, and transparency to the public comment process.  

During his own testimony on Feb. 27, Dominion Energy South Carolina President Keller Kissam told state lawmakers what new generation in the state is going to look like, pointing out that the utility now has 1,100 megawatts of solar on its system, totaling roughly more than a fifth of its total generation mix.

“We’re proud of that, and there’s more coming,” said Kissam. “People say, ‘oh, but you’re building a gas plant.’ Well, we’ve got more solar that has been committed to be constructed on our system than the output that we would have out of this [proposed] plant. This plant is simply designed to be paired with all of these renewables.”

The proposed gas plant pairs with solar, he said, and would actually allow for more solar on the system of Dominion Energy, as well as Santee Cooper.

“From an environmental standpoint,” Kissam said, “it’s about the proliferation of renewables and that’s important. The most important part about this plan, if it gets constructed and it gets rolling, is we can retire coal plants that we currently have on our system.” 

As H. 5118 faces debate on the Senate floor this week, some senators have come out against it, including State Republican Senate Majority Leader Shane Massey, who thinks the bill is being rushed.

Massey said last week that the 80-plus page bill introduced on Feb. 15 has too many changes to regulations, and suggested delaying its consideration until next year.

“I’m not going to be held hostage by people saying if you don’t give us exactly what we want when we want it we’re going to turn the lights out on you,” Massey said.

Other opponents of H. 5118 include the Southern Environmental Law Center, the Coastal Conservation League, the South Carolina Alliance for Clean Energy, and Sustaining Way.