Cayce, SC, June 30, 2010... The Public Service Commission of South Carolina today voted unanimously to approve an overall increase in retail electric revenues of approximately $101.2 million, or 4.88 percent, for South Carolina Electric & Gas Company, principal subsidiary of SCANA Corporation (NYSE: SCG). SCE&G President Kevin Marsh said the company’s need for rate relief was driven primarily by costs associated with government-mandated environmental and safety initiatives.
The approved increase was presented to the Commission in late May as part of a stipulation SCE&G had reached with several parties in the case. The stipulation included agreement by SCE&G to factor certain credits into its rates over the next two years, including a one-time credit of $25 million which reflects the approximate amount that a weather normalization mechanism would have saved customers in the first quarter of 2010 when extremely cold weather caused customer bills to spike.
With those credits factored in, the full amount of the 4.88 percent increase actually won’t be reflected on customer bills until July 2012. Overall rates will increase as follows:
- 2.5 percent in July 2010
- 1.2 percent in July 2011
- 1.18 percent in July 2012
The PSC also approved the use of a weather normalization adjustment on a 12-month trial basis to help reduce the impact of extremely hot or cold weather on electric bills.
“The biggest user of electricity in your home is your heating and cooling system. So when outside temperatures are unusually high or low, your energy costs can fluctuate significantly from month to month or year to year,” said Marsh. “For example, the uncommonly cold weather that hit South Carolina during the first couple months of 2010 led to significant bill increases for many of our customers. The WNA will reduce the volatile impact of that kind of abnormal weather on customer bills. When temperatures are higher or lower than normal, you’ll be billed based on what temperatures would normally be for that month.”
Marsh said “normal weather” will be based on the avage temperature for each billing period over the past 15 years. He said the WNA will likely begin appearing on customer bills in August.
South Carolina Electric & Gas Company is a regulated public utility engaged in the generation, transmission, distribution and sale of electricity to approximately 659,000 customers throughout central, southern and southwestern portions of South Carolina. The company also provides natural gas service to approximately 313,000 customers throughout the state.
South Carolina Electric & Gas Company
Retail Electric Rate Order
Public Service Commission of South Carolina
|Date of Application
||January 15 ,2010 |
||2009-489-E (copy available at www.psc.sc.gov)|
|Date of Public Hearing
||May 24, 2010 – May 26, 2010 |
|Date of SCPSC Decision
||June 30, 2010 |
||Twelve Months Ended September 30, 2009, As Adjusted|
|Effective Date of New Rates
||July 15, 2010 |
|Annual Revenue Increase (millions)
|Annual Percent Increase
|Equity Component of Capitalization (millions)
|Equity Component of Capitalization Ratio
|Allowed Return on Common Equity (ROE)
|Retail Electric Rate Base (millions)
|Return on Rate Base
Reconciliation of Requested and Approved Revenue Increase
|Annualized Revenue Increase Requested by SCE&G
|Reduction in requested ROE
|Wateree scrubber expenses deferral
|Reduction in tree trimming expenses
|Labor costs and associated benefits
|Fuel inventory levels
|Storm insurance premiums
|Annualized Revenue Increase Approved by SCPSC
SAFE HARBOR STATEMENT
Statements included in this press release which are not statements of historical fact are intended to be, and are hereby identified as, “forward-looking statements” for purposes of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include, but are not limited to, statements concerning key earnings drivers, customer growth, environmental regulations and expenditures, leverage ratio, projections for pension fund contributions, financing activities, access to sources of capital, impacts of the adoption of new accounting rules, estimated construction and other expenditures. In some cases, forward-looking statements can be identified by terminology such as “may,” “will,” “could,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “projects,” “predicts,” “potential” or “continue” or the negative of these terms or other similar terminology. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and involve a number of risks and uncertainties, and that actual results could differ materially from those indicated by such forward-looking statements. Important factors that could cause actual results to differ materially from those indicated by such forward-looking statements include, but are not limited to, the following: (1) the information is of a preliminary nature and may be subject to further and/or continuing review and adjustment; (2) regulatory actions, particularly changes in rate regulation, regulations governing electric grid reliability and environmental regulations; (3) current and future litigation; (4) changes in the economy, especially in areas served by subsidiaries of SCANA Corporation (SCANA); (5) the impact of competition from other energy suppliers, including competition from alternate fuels in industrial interruptible markets; (6) growth opportunities for SCANA’s regulated and diversified subsidiaries; (7) the results of short- and long-term financing efforts, including future prospects for obtaining access to capital markets and other sources of liquidity; (8) changes in SCANA’s or its subsidiaries’ accounting rules and accounting policies; (9) the effects of weather, including drought, especially in areas where the generation and transmission facilities of SCANA’s subsidiaries are located and in areas served by those subsidiaries; (10) payment by counterparties as and when due; (11) the results of efforts to license, site, construct and finance facilities for baseload electric generation; (12) the availability of fuels such as coal, natural gas and enriched uranium used to produce electricity; the availability of purchased power and natural gas for distribution; the level and volatility of future market prices for such fuels and purchased power; and the ability to recover the costs for such fuels and purchased power; (13) the availability of skilled and experienced human resources to properly manage, operate, and grow the Company’s businesses; (14) labor disputes; (15) performance of SCANA’s pension plan assets; (16) higher taxes; (17) inflation; (18) compliance with regulations; and (19) the other risks and uncertainties described from time to time in the periodic reports filed by SCANA or South Carolina Electric & Gas Company with the United States Securities and Exchange Commission. The Company disclaims any obligation to update any forward-looking statements.
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