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SC’s nuclear scandal, politicians and clean/dirty hands

on Tuesday, 05 September 2017. Posted in Editorials, Opinions

By Phil Noble

For a columnist like me, the state’s nuclear scandal is the gift that keeps on giving. It is no exaggeration to say that there could be a column every week (or several times a week) on the growing scandal – and it’s likely to be so for months and even years to come.

There will be thousands of news articles written by journalists, millions of words spoken by politicians and utility executives, and billions of dollars in payments to rate payers are at stake.

As we begin (and we are just at the beginning of the beginning) to work our way through this $9 billion scandal effecting millions of people in our state, there are two basic facts that we should never lose sight of – and two necessary first steps that must be taken in dealing with this gigantic scandal.

The two basic facts:

Those responsible should be held accountable. SCANA (parent company of South Carolina Electric and Gas), Santee Cooper and the politicians that passed the legislation to enable this to happen (and got paid for it) – will all be blaming each other when they are all at fault. Their hands are dirty.

Those not responsible, the rate payers, should not have to pay. The people with absolutely no responsibility for this disastrous scandal – the rate payers – are being asked to pay billions of dollars, perhaps for as long as 60 years. This is wrong. Their hands are clean.

The two necessary first steps:

The legislators, statewide elected officials and Congressional politicians with dirty hands must ‘come clean.’ This means they should disclose all of their financial dealings with SCANA, Santee Cooper and the electric co-ops – and give the money back. They should return all campaign contributions since the scandal began in 2007 and they should disclose and return all of the retainers, consulting contracts and other unreported payments they and their immediate families have received. (Better than returning the money, they should give it to charity.)

Those utility leaders with dirty hands who are directly responsible should resign. This means that all of the boards of directors and senior management of both SCANA and Santee Cooper should resign. They should also refund any bonuses, stock options or other extra payments they have received since the beginning of the scandal in 2007. When they leave, there should be no severance payments or golden parachutes. None.

If someone thinks this seems overly tough, my suggestion is to ask the South Carolina families that are being asked to pay on average $7,000 for as long as 60 years for this scandal if they think this is overly tough.

So, measured against these four points above, where are we today?

Let’s start with the rate payers. Since the rate payers are absolutely blameless in this, they should not be asked to pay. As such, all of their utility rates should be rolled back to 2007 levels when the scandal began. Plus, they should be refunded, with interest, all of the billions of dollars they have already paid out for the failed project.

As best I can tell from news reports, no one – repeat no one – has said this should be the goal. Instead, the only discussions so far are how much more should the rate payers have to pay and for how long.

Next, for those responsible – all of the boards and senior management of SCANA and Santee Cooper. What’s happened? So far, something but not much. The CEO of Santee Cooper, Lonnie Carter is on the way out. Whether he resigned or was pushed is a matter of semantics – he’s gone.

Thus far, there is no indication what his severance package will be (assuming he gets one) and no indication that he will be asked to, or will voluntarily, give back his pay raises and other extra payments since the scandal began in 2007.

None of the other 7 members of top management of Santee Cooper or any of the 12 members the Board of Directors have indicated they will be leaving.

Also, all 12 members of SCANA’s top management and all 10 members of the Board of Directors are still in place.

I may have missed it, but to date, I have never heard anyone from either the boards or management of SCANA or Santee Cooper who created this scandal say these two words: I’m sorry.

Now, let’s look at the politicians – the state legislature, statewide elected officials and the Congressional delegation. What’s happened? So far, something but not much. Republican Representative Bill Hixon has returned all of his campaign contributions from both SCANA and the electric coops. Democratic Representative Russell Ott has returned his contribution from SCANA. This is significant as both are members of the newly appointed House committee charged with investigating the scandal.

That’s it.

None of the other 124 members of the state House, nor any of the 46 state senators, nor the governor, nor any of the other 8 statewide elected officials, nor any of the 9 members of the Congressional delegation in Washington have returned the money. Nor has anyone voluntarily disclosed any payments of retainers, consulting contracts and such payments from the utilities to themselves or their immediate families. None.

I may have missed it, but to date, I have never heard any one of these politicians who helped create this scandal say these two words: I’m sorry.

And last, let’s consider the ‘investigations’ into the scandal. To date, both the state House and Senate have announced that they will conduct an investigation to find out what happened and who is responsible. The answer to the first question is complex; the answer to the second question is easy.

The legislature should simply look in the mirror… or look down at their dirty hands.

The whole thing began when the legislature passed something called the Base Load Review Act in 2007 that allowed the utilities to charge their ratepayer in advance for the cost of construction of the nuclear plants plus a 10.25 per cent guaranteed profit – even if the nuclear plants were never built. With lighting spend in just a few days, the legislation passed the Senate unanimously and passed in the House with only six votes in opposition.

To expect the legislature to, in essence, investigate themselves without, at a minimum, first telling us how much the utilities have paid them – is beyond absurd. This is what one would expect from some corrupt Third World government.

Dirty hands cannot clean up this scandal.

What we need is a completely independent commission of outside experts and investigators to examine every detail of the scandal. And even though Gov. McMaster has not ‘come clean’ about his utility money, he could at least act like he wants to get to the bottom of this by appointing such an independent commission. It would be a start.

We deserve better.

It does not have to be this way.

Phil Noble has a technology firm in Charleston, is founder of World Class Scholars and writes a weekly column for the S.C. Press Association. Reach him at This email address is being protected from spambots. You need JavaScript enabled to view it. and get his columns at www.PhilNoble.com.

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