Managing costs and smart business moves have kept our electric rates stable for more than 12 years at York Electric Cooperative, but not everything is in our hands.
Government regulations, skyrocketing prices for critical materials and other factors are driving up our costs. We also face the prospect of significant cost increases from our primary source of wholesale power, Santee Cooper. Here’s why.
We join with other electric cooperatives to buy wholesale power through Central Electric Power Cooperative, an energy portfolio manager that negotiates on our behalf to purchase electricity at the best possible rates from Santee Cooper, Duke Energy and others.
Central’s long-term contract with Santee Cooper requires the cooperatives to pay for about 70% of Santee Cooper’s costs, including for large construction projects such as power plants. Notably, that includes the billions of dollars Santee Cooper and SCE&G spent before abandoning their effort to expand the V.C. Summer nuclear plant in Fairfield County.
Cooperative members across South Carolina will be charged for that V.C. Summer debt for decades to come—until 2056. In fact, it is already factored into your power bill as a small percentage of the monthly total.
Unfortunately, even more costs are coming. After the V.C. Summer project’s 2017 cancellation, Santee Cooper agreed to freeze its electric rates for four and a half years to settle the “Cook” class-action lawsuit brought by the utility’s customers.
That rate freeze has kept our power costs—and yours—stable.
Unfortunately, it ends Dec. 31. The Cook case settlement also provides that Santee Cooper may recover certain unbudgeted costs incurred during the rate freeze. Unfortunately, Santee Cooper has claimed that a series of events during the rate freeze caused the utility to incur approximately $750 million in unbudgeted costs— what Santee Cooper calls the “Cook Settlement Exceptions.”
When the rate freeze ends, Santee Cooper will begin charging its customers— including co-op members—to recover those costs. These charges will come on top of Santee Cooper’s other planned rate increases.
Last month, York Electric made the hard decision to adjust rates to begin covering these expenses.
In keeping with our mission to protect our members from paying unreasonable costs, York Electric—through Central—continues to ask questions and scrutinize Santee Cooper’s plans to charge consumers for these claimed Cook Settlement Exceptions. The court-appointed attorneys for the Cook class action are also involved in this process.
Central will be negotiating with Santee Cooper to ensure our members pay only their fair share. While we hope these negotiations lead to a resolution regarding these Santee Cooper costs and how they are collected, Central stands ready to do whatever is necessary to protect our members.
As we move forward, know that your co-op is doing everything it can to manage costs while still delivering safe, reliable electricity to your homes and businesses.
Chairman, YEC Board of Trustees