At first glance, I must admit, the Energy Policy Institute (EPI) looks pretty good on paper. As do many other government entities, what at the outset seem to be reasonable & cost efficient, is anything but. EPI is a proposed new bureaucracy with 3 members appointed by the general assembly for a 4 year term at a salary of $100k per year. The members are vested with the power to regulate the rates and services of every public utility. They are tasked to “fix just & reasonable standards, classifications, regulations, practices & measurements of service to be furnished, imposed or observed and followed” by every public utility in SC. Even though this commission is governed by a 6-member board of elected officials, the power held by 3 bureaucrats for that length of time encompassing “every” public utility can be incredibly dangerous. The bill H5118 that creates the EPI, should be drastically scaled back or “killed” outright.
The last time something of this magnitude was attempted, the taxpayers were left with billions of dollars invested with nothing to show for it. The Santee Cooper/SCANA project was an attempt from the state/federal entities to build nuclear plants, but instead has become a long-term debt for an undetermined period of time.
There seem to be many vague references in this bill that may be of concern. Currently, the bill states that the EPI will “promote sustainable and resilient” energy. In addition, “amending section 58-4130 relating to voluntary renewable energy programs” or “authorize competitive procurement programs for renewable energy facilities”. That verbiage can mean different things for republicans and democrats. For example, a democrat may favor a renewable energy source over a cheaper “fossil fuel” solution. A republican would most likely calculate the cost benefit of any renewable source by considering the established subsidies and intermittent reliability of the production of energy. This type of language could easily be redirected by future legislators with ulterior goals.
Billions of dollars have been invested in “green” technology. (Solar, wind, EV’s). Can these “green solutions” make it in the marketplace without heavy subsidies or tax incentives? The Chester county lithium battery project has been drastically reduced due to weak demand for Electric vehicles. See related article.
Market forces are always preferable to the government placing a hand on the scale to determine winners in any sector, let alone in energy.
Federal and state governments have dismal records when tasked with building structures that could be accomplished through the private sector. The United States Postal Service and Amtrak are just two examples of the government being unable to “break even” on services for decades. The “Big Dig” of Boston was completed 9 years late & had cost overruns of 12 billion dollars.
Some of the positive aspects of this bill have to do with expanding current facilities and the repurposing of the Canady coal units in Colleton county. These items make sense, because they’re not new structures that would fall under endless reviews/environmental impact studies, etc. The call to streamline approval of the brownfield site is always preferred and this site is close to existing natural gas supplies. The pilot testing of the small modular reactors (SMR) would be an excellent way to provide “emission free” energy without the massive undertaking of another multi-billion-dollar nuclear plant. The proposal to double the output of the Bad Creek Storage facility should also be considered to cover peak storage capacity. These proposals can be accomplished under the purview of existing state agencies. The establishment of another entity with vast centralized power is not necessary.
Creating the Energy Policy Institute to accomplish tasks best undertaken by the private sector should be avoided at all costs. The provision for the “general assembly can revise the current regulatory structure to reduce cost, delays & uncertainty of planning, siting & constructing a new generation of transmission resources” should be done on a consistent basis, without creating another government entity. In addition, enforcing “robust energy efficiency and demand side management initiatives” will most likely produce dubious environmental benefits that would be best left to market forces. Private industry continues to reduce costs & increase efficiency in order to expand profits; that’s how it’s supposed to work. The proposal to create “global” SC Nexus will add an expense of $10 million/year and increases the reliance on federal funds by $75 million/year.
Trying the same thing over and over again but expecting a different result is the definition of insanity. Having the government create a new entity to construct new energy facilities after they’ve left taxpayers footing the bill for billions like the VC Nuclear project is a foolish endeavor.
Providing research and data that can be used by the private sector is a much better way to accomplish these goals without risking precious tax dollars. Government should always look to offer tax incentives that benefit taxpayers and the free market. When the government offers to fund risky infrastructure projects without any restrictions or penalties for cost overruns, more often than naught, taxpayers pay the price.
UPDATE: H5118 passed the House on March 28, 2024 with a vote of 83 Yeas and 21 Nays. It is now up for a vote by the Senate and could hit the floor at anytime.
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https://palmettostatewatch.com/energy-mega-bill-taxpayers-pay-the-price/
