SCANA/Dominion in wait-and-see mode as lawmakers debate rate cuts

17 May 2018 - 12:00 am UTC

Dominion Energy’s [NYSE:D] ability to close its USD 14.6bn merger with South Carolina electric utility SCANA [NYSE:SCG] during an election season may hinge on the duration of the proposed rate cuts, said a source familiar with and two sources briefed on the situation.
The South Carolina General Assembly is debating temporary rate cuts for SCANA customers, which do not alter the situation from the merging utilities’ standpoint, the source familiar said. In theory, rate cuts could be made permanent but that is not on the table right now and it is premature to draw any conclusions, he added.
The rate cut decision by the Assembly centers on rate payers’ burden of what SCANA can collect from customers for construction costs of SCANA’s failed nuclear power project, said the two sources briefed.
The South Carolina House of Representatives and governor are pushing for an 18% rate cut, while the State Senate is seeking a 13% cut. A conference committee comprising representatives and senators is expected to reach a decision within the next couple of weeks.
In an interview with this news service, South Carolina Governor Henry McMaster press secretary Brian Symmes said the top priority for the governor has been ratepayers, not Dominion, SCANA or its shareholders. 
Until a decision is made by lawmakers, the Dominion and Scana deal is in limbo, the source familiar with the situation said.
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by Michael Schoeck and Bhavna Kaul in New York