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SCE&G Files for Rate Adjustment Under Base Load Review Act

^{Published on 2010-05-28 12:40:09 - Market Wire}
 

CAYCE, S.C.--([ BUSINESS WIRE ])--South Carolina Electric & Gas Company, principal subsidiary of SCANA Corporation (NYSE: SCG), today filed with the Public Service Commission of South Carolina and the South Carolina Office of Regulatory Staff for an overall 2.73 percent increase to its electric rates under provisions of a state law known as the Base Load Review Act. The BLRA effectively reduces the cost of building nuclear power plants in South Carolina by allowing the statea™s regulated utilities to adjust rates annually during construction of such plants to recover related financing costs.

"We estimate this will save our customers at least $4 billion in electric rates over the life of the new units"

SCE&G and state-owned utility Santee Cooper are building two nuclear electric-generating units at the site of the V.C. Summer Nuclear Station near Jenkinsville, S.C. The first unit is expected to come on line in 2016, the second in 2019, pending approval by the Nuclear Regulatory Commission.

SCE&G President Kevin Marsh said paying financing costs while construction is ongoing, as opposed to waiting until the project has been completed, lowers the cost of building the new units by about $1 billion, which in turn reduces the amount SCE&G customers will pay through rates for such things as the cost of capital, depreciation, property taxes and insurance associated with the project. aWe estimate this will save our customers at least $4 billion in electric rates over the life of the new units,a he said.

In a report filed with the PSC and the ORS last week, SCE&G indicated that construction of the new nuclear units is proceeding in full compliance with approved cost and schedule projections. Rate increases under the BLRA currently are expected to average a little more than 2 percent annually through 2019, but will vary year to year based on actual construction expenditures incurred.

If todaya™s filing is approved, SCE&Ga™s current electric rates would increase in October as follows:

• 2.82 percent for residential customers (the current monthly bill of a customer using 1,000 kilowatt hours of electricity would increase $3.33, going from $118.14 to $121.47)
• 2.71 percent for small commercial customers
• 2.82 percent for medium commercial customers
• 2.55 percent for large commercial/industrial customers.

Todaya™s BLRA filing is unrelated to SCE&Ga™s recent request for an overall 4.88 percent increase to retail electric rates to help recover costs associated with government-mandated environment and safety initiatives; a public hearing on that request concluded Wednesday.

PROFILES

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.

SCANA Corporation, a Fortune 500 company headquartered in Columbia, SC, is an energy-based holding company principally engaged, through subsidiaries, in electric and natural gas utility operations and other energy-related businesses. Information about SCANA and its businesses is available on the Companya™s web site at [ www.scana.com ].

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, aforward-looking statementsa for purposes of Section27A of the Securities Act of 1933, as amended, and Section21E 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 amay,a awill,a acould,a ashould,a aexpects,a aplans,a aanticipates,a abelieves,a aestimates,a aprojects,a apredicts,a apotentiala or acontinuea 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 SCANAa™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 SCANAa™s or its subsidiariesa™ accounting rules and accounting policies; (9) the effects of weather, including drought, especially in areas where the Companya™s generation and transmission facilities are located and in areas served by SCANA's 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 Companya™s businesses; (14) labor disputes; (15) performance of SCANAa™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 (SCE&G) with the United States Securities and Exchange Commission (SEC). The Company disclaims any obligation to update any forward-looking statements.