Santee Cooper

Santee Cooper, also known as the South Carolina Public Service Authority, is South Carolina's state-owned electric and water utility. Its headquarters are located in Moncks Corner, South Carolina.

Santee Cooper has more than 165,000 residential and commercial customers in Berkeley, Georgetown, and Horry counties. The utility is heavily dependent on coal-fired power, which accounts for just over 80% of the electricity it generated in 2009 with nuclear and gas-fired plants providing little over 8% of generation capacity each. Minor amounts of generation capacity are from oil, hydro and landfill methane. Santee Cooper supplies power to the cities of Bamberg and Georgetown, 31 large industrial customers, Charleston Air Force Base and four wholesale customers. Santee Cooper generates the power distributed by South Carolina's 20 electric cooperatives.

Santee Cooper is governed through a board of directors appointed by the governor and approved by the state Senate. On its website Santee Cooper states that "a board member represents each congressional district and each of the three counties where Santee Cooper serves retail customers directly; one board member has previous electric cooperative experience; and the chairman is appointed at-large.

History
In 1934, legislation under the Roosevelt administration’s public works programs enabled South Carolina to obtain federal grants and loans for the creation of the South Carolina Public Service Authority. The primary purpose was to construct and operate the Santee Cooper Hydroelectric and Navigation Project. At the time, 93 percent of the state’s residents lived without electricity. Private power companies fought the Santee Cooper project, eventually taking the battle to the U.S. Supreme Court. In April 1939, injunctions against the project were overturned and construction proceeded for 27 months until completion. The $48.2 million project (55 percent federal loan, 45 percent federal grant) first generated electricity on February 17, 1942.

Power portfolio
In 2009 Santee Cooper had a total 6,104 MW of electric generating capacity and purchased power and had peak demand of 5590MW. Of the electricity it generated in 2009, Santee Cooper produced 80.856% from coal, 8.42% from natural gas, 8.84% from nuclear, .08% from oil, 1.74% from hydroelectricity, and 0.35% from landfill methane. All of Santee Cooper's power plants are in South Carolina. In 2009 Santee Cooper sold 25.8 gigawatt hours of electricity and earned $1.7 billion in revenue.

Nuclear power development
In April 2008, Santee Cooper and SCE&G filed an application with the Nuclear Regulatory Commission to build two 1100 MW nuclear power plants at the V.C. Summer Nuclear Station in Jenkinsville, South Carolina. The plants would be operational in 2016 at the earliest.

Proposed Coal projects
Santee Cooper currently has no active proposals for new coal-fired power stations. In late 2009 Santee Cooper announced that it was suspending its push to have the Pee Dee Generating Facility approved. A media release announcing the decision to suspend the project stated that "customers could benefit from the decision, because they may not need to bear the capital costs of constructing the proposed Pee Dee facility." The utility’s chairman O.L. Thompson stated in the media release "this could end up being a true benefit for Santee Cooper customers."

Opposition to the Pee Dee Generating Facility
On February 11, 2009, Governor Mark Sanford came out against Santee Cooper's proposed $1.25 billion coal-fired Pee Dee Generating Facility. In announcing his decision, the governor cited expectations of tougher environmental regulations, rising coal prices, and a weak economy. Sanford said the cost of the plant could double because of restrictions on mercury emissions and expected caps on carbon dioxide emissions.

Despite Gov. Sanford's position, the state Department of Health and Environmental Control upheld Santee Cooper's air quality permit on Thursday, February 12.

More than 100 residents of Florence County in South Caroline brought an inflatable smokestack to the courthouse to protest the permit that was granted to Santee Cooper to build the Pee Dee Generating Facility on the banks of the Great Pee Dee River. The plant would emit over 11 million tons of carbon dioxide per year, as well as 60 different toxic pollutants, including arsenic, dioxins, heavy metals, mercury, and selenium.

Pee Dee Generating Facility cancelled
On August 21, 2009, Santee Cooper's chairman said the company might not need the new Pee Dee Generating Facility if five upstate South Carolina cooperatives instead buy power from rival Duke Energy. O.L. Thompson said the board would vote on whether to allow the cooperatives, which are currently supplied by Santee Cooper, to strike a deal with Duke. "If the economy stays like it's projected to stay, that might be enough to keep us out of Pee Dee," he said.

On August 24, 2009, the Santee Cooper board voted to suspend plans for the proposed plant. As reasons for the cancellation, CEO Lonnie Carter cited a decrease in electricity demand related to the economic downturn and pending cap-and-trade legislation that could greatly increase the operating costs of coal-fired power plants.

In a media release announcing the suspension, Santee Cooper specifically singled out the potential cost of retrofitting Carbon Capture and Storage to the proposed plant. "The bill calls for carbon capture and sequestration technology to be placed on new plants by 2025, and there currently exists no technology to do that. The cost of the technology and the carbon tax are unknown and expected to be high, and this uncertainty causes great concern for Santee Cooper in considering future coal plants," Santee Cooper president and CEO Lonnie Carter stated.

Existing coal-fired power plants
As of March 2011 Santee Cooper has four operating coal power plants with a total generating capacity of 4043 megawatts installed capacity.

In 2006, Santee Cooper's 4 coal-fired power plants emitted 27.1 million tons of CO2 and 83,000 tons of SO2 (0.55% of all U.S. SO2 emissions).

The most recent coal-fired additions to Santee Cooper's power generation portfolio were the Cross Generating Station Unit 3 which was commissioned in 2007 and Cross Generating Station Unit 4 which was commissioned in October 2008.

Coal supply
In a 2007 media release CONSOL Energy announced that it had reached an agreement with Santee Cooper "to supply approximately 6.5 million tons for the 2007-2011 timeframe. The coal is expected to be shipped from CONSOL Energy's Bailey Mine to Santee Cooper's new Cross #3 and Cross #4 units that are based in South Carolina South Carolina, state of the SE United States." Sunrise Coal, a small Indiana coal mining company which is a subsidiary of Hallador Energy Company, states on its website that it supplies Santee Cooper. The company owns the 3 million tonne a year Carlisle mine in Indiana.

In its 2009 annual report, Santee Cooper states that CSX "provides substantially all rail transportation service for the Authority’s coal-fired generating units. During 2002, a new agreement was signed with an effective date of January 1, 2003. This contract will continue to apply a price per ton of coal moved, with the minimum being set at four million tons per year."

Settlement with EPA to cut pollution
On March 16, 2002 the U.S. EPA, the Department of Justice and the State of South Carolina announced a New Source Review requirements settlement with the South Carolina Public Service Authority (Santee Cooper) to address alleged Clean Air Act violations at several of its coal-fired power plants in the state.

Under the settlement agreement Santee Cooper will spend approximately $400 million until 2012 to install pollution control devices to decrease emissions at its Winyah Generating Station, Cross Generating Station, Jefferies Generating Station and Grainger Generating Station. In April of 2002 the U.S. Public Research Interest Group released a study stating that Santee's Winyah plant had one of the nation's most significant increases in pollution between 1995 and 2000.

The EPA estimates that 70,000 tons of SO2 (contributor to acid rain and cardiovascular disease) and NOx (contributor to ground-level ozone, acid rain and global warming) emissions will be reduced annually from Santee Cooper's four coal-fired plants in South Carolina. In addition the company was forced to pay a $700,000 fine to the State of South Carolina and $1.3 million in civil penalty fines to the federal government. Santee Cooper is also forced to spend at least $4.5 million to finance "environmentally beneficial" projects in the state.

Grainger idled, then closed
In 2012 Santee Cooper idled the Grainger Generating Station, and decided in October 2012 not to reopen it, saying it would be too costly to comply with the EPA's new Mercury and Air Toxics Standards for air emissions.

Coal lobbying
Santee Cooper is a member of the American Coal Ash Association (ACAA), an umbrella lobbying group for all coal ash interests that includes major coal burners Duke Energy, Southern Company and American Electric Power as well as dozens of other companies. The group argues that the so-called "beneficial-use industry" would be eliminated if a "hazardous" designation was given for coal ash waste.

ACAA set up a front group called Citizens for Recycling First, which argues that using toxic coal ash as fill in other products is safe, despite evidence to the contrary.

ACCA also helped set up the Coal Combustion Products Partnership (C2P2) program, a cooperative effort between the U.S. EPA, ACAA, the Utility Solid Waste Activities Group, the U.S. Department of Energy, the U.S. Department of Agriculture-Agricultural Research Service, U.S. Federal Highway Administration and the Electric Power Research Institute to "help promote the beneficial use of Coal Combustion Products (CCPs) and the environmental benefits that result from their use." The C2P2 project was suspended after the EPA released a March 23, 2011 inspector general report stating that the federal government had promoted some uses of coal ash, including wallboard or filler in road embankments, without properly testing the environmental risks. The report said wallboard "may represent a large universe of inappropriate disposal applications with unknown potential for adverse environmental and human health impacts." Coal ash recyclers and manufacturers that use it have argued that tougher federal regulations would place a stigma on the substance and hinder efforts to reuse some of the 130 million tons produced at U.S. coal-fired power plants each year.

Santee Cooper President and CEO Lonnie Carter is the chairman American Public Power Association, a lobby group for community-owned electric utilities.

Opposing federal environmental regulations on greenhouse gases and other pollution
In February 2011, Santee Cooper's CEO and President, Lonnie Carter appeared before the U.S. House of Representatives House Energy and Commerce Committee's Subcommittee on Energy and Water to oppose moves by the U.S. Environmental Protection Agency to regulate greenhouse gases (GHG)under the Clean Air Act. Appearing before the committee Carter boasted that Santee Cooper has "197 megawatts of renewable generation already online or under contract." However, he made no mention of the utility's heavy relianace on coal-fired power. In his testimony Carter complained about the potential impact of the EPA's move to regulate greenhouse gas emissions through "new source performance standards".

"There is currently no off-the-shelf technology available to address GHG emissions at a commercial scale - making it different in like and kind from other emissions regulated under the Clean Air Act. New construction projects will likely be significantly delayed because there is no clarity in how to address GHG in PSD [ed: Prevention of Significant Deterioration] permits. EPA's failure to provide the necessary tools, information, and direction will lead to permits being delayed, and complex legal challenges to permits. The Clean Air Act was simply not designed to address GHG emissions. The policy to limit GHG emissions should be set by Congress. Continuing on a path toward regulating GHG emissions under the Clean Air Act could stifle the already slow permitting process, raise costs, and limit economic development and industrial growth around our country at a time when we need jobs the most," he stated.

Carter also flagged the utility's opposition to possible EPA moves to regulate "new rules over the next few years, including coal ash, maximum available control technology standards, cooling water intake rules, air quality standards for ozone, lead and particulate matter". Regulation these aspects of power generation industry, he claimed, they they "individually, they represent sizeable cost impacts. Together, they could be enough to significantly curtail economic development and may force the premature closing of low cost, reliable power facilities that keep our nation running."

Registered lobbyists
Between February 2002 and August 2003, federal lobbying disclosure reveal that Santee Cooper paid Powell Goldstein LLP $300,000 for lobbying services. In February 2008 the utility hired Nelson, Mullins, Riley & Scarborough. However, Santee Cooper ended the contract in March 2009.

In late 2010 Santee Cooper appointed Richard Kizer as Vice President of Government and Community Relations. In the media release, Santee Cooper stated that Kizer had been "employed with Santee Cooper for the past 17 years" during which time utility CEO Lonnie Carter stated he "consistently demonstrated leadership and sound guidance on the many varied and complex government and community relations issues Santee Cooper faces." The media release stated that Kizer had "previously served as director of government and community relations and prior to that role, served as director of governmental relations and as a legislative assistant. Previous to Santee Cooper, Kizer served as a lobbyist with the South Carolina Teachers Association from 1993 to 2001." (It is unclear how the "17 years" figure can be correct given later statements in the media release.)

Lawsuit
In April 2013 the Southern Environmental Law Center filed two lawsuits in state court alleging that Santee Cooper's Grainger Generating Station had violated the state’s Pollution Control Act. The lawsuit alleges that Santee Cooper has known since at least the mid-1990s that arsenic levels of up to 300 times the federal safe limits have been seeping into groundwater around the unlined ash ponds, which are adjacent to the Waccamaw River. The Center asked a judge to force Santee Cooper to move pollution from the ash ponds - which total abut 82 acres - to an offsite, lined landfill and clean up the groundwater so it meets federal drinking water standards.

The Coalition for Clean Energy also sued the S.C. Department of Health and Environmental Control over its failure to act on a permit application that would have limited the amount of pollution discharged from the Grainger facility.

Groundwater testing at the Grainger site has repeatedly shown arsenic levels ranging from 100 parts per billion to 900 parts per billion – much higher than the Environmental Protection Agency’s maximum safe level of 10 parts per billion. Arsenic levels of up to 3,225 parts per billion have been recorded at the site, according to the lawsuit.

Fly ash disposal
In its 2010 annual report, under the heading of "recycling, Santee Cooper boasts that over 1 million tons of "coal combustion products such as synthetic gypsum and fly ash were put to beneficial reuses as wallboard, cement and agricultural applications."

Personnel

 * Lonnie Carter, President and CEO.

Board of Directors

 * O. L. Thompson, Chairman; Mt. Pleasant, SC
 * G. Dial DuBose, First Vice Chairman; 3rd Congressional District
 * William A. Finn, 1st Congressional District
 * J. Calhoun Land IV, 6th Congressional District
 * W. Leighton Lord III, 2nd Congressional District
 * Dr. John Molnar, Horry County
 * Peggy Pinnell, Berkeley County
 * David Springs, Georgetown County
 * Cecil Viverette, At Large
 * Hilton Head, 4th Congressional District

Contact details
Santee Cooper Headquarters One Riverwood Drive Moncks Corner, SC 29461 Phone: 843-761-8000 Website: https://www.santeecooper.com/portal/page/portal/santeecooper/homepage

Related SourceWatch Articles

 * South Carolina and coal
 * United States and coal
 * Global warming
 * Coal
 * EPA Coal Plant Settlements

Santee submissions and testimony on greenhouse gas regulation

 * Lonnie Carter, Oral Testimony of Santee Cooper President & CEO Lonnie Carter Before the U.S. House Energy & Commerce Subcommittee, February 9, 2011
 * Lonnie Carter, Written Testimony of Santee Cooper President & CEO Lonnie Carter Before the U.S. House Energy & Commerce Subcommittee, February 9, 2011

Santee Cooper and fly ash

 * Thomas F. Edens (Administrator Combustion Products Utilisiation, South Carolina Public Service Authority), "Recovery and Utilisation of Pond Ash", 1999 International Ash Utilisation Symposium, July 1999. (Pdf)
 * James G. Keppler, "Carbon Burn-Out An Update on Commercial Applications", Presentation to the 2001 International Ash Utilization Symposium, September 2001.
 * "Santee Cooper's 2004 Tobacco Road Fly Ash trial, 2004. (This file is a collection of various Santee Cooper reports from 2004 on a trial project using fly ash for road construction). (Pdf)