• Georgetown Times
  • Waccamaw Times
  • Inlet Outlook

City says new Santee Cooper contract will save $11 million

  • Wednesday, October 30, 2013

  • Updated Friday, November 1, 2013 11:36 pm

Electric rates in the City of Georgetown have been a thorn in the side for elected officials for many years.
Some residents have contacted City Council members and the mayor about exorbitant monthly bills.
In April, Donald Gilliard told council both his mother and aunt — who live in the city — received electric bills for more than $600.
“This is an opportunity for council to understand there are seniors and poor people who are falling through the cracks.”
Mayor Jack Scoville said the city’s contract with Santee Cooper – the supplier of the electricity that is resold by the city – expires in November.
And, Scoville said, electric deregulation laws changed in 1996 and the city is now allowed to seek proposals from other electricity producers.

The proposals

Scoville said the city received contract proposals from Santee Cooper, SCE&G, Duke Power, Southern Power and Piedmont Municipal Power.
“The City of Georgetown is pleased to announce its intent to pursue a contract with Santee Cooper to supply wholesale power for the city’s electric distribution system,” Scoville wrote in a press release.
The city has operated a municipal electric utility since 1921 and currently serves about 3,800 residential customers and about 1,200 commercial customers.
The city has purchased its power from Santee Cooper for many years.
Scoville said “after a lengthy technical analysis” of the proposals from the five companies, it is in the city’s best interest to stick with Santee Cooper.
As a result of the renegotiated contract, the city is expected to save about $11.1 million over the next 10 years.
The Georgetown Times requested a copy of each of the proposals submitted to the city. While the amounts the city would be charged by each company was provided, the names of the companies were not listed with the proposed cost.
What is known is what the city calls “Utility 1” is Santee Cooper and has a proposed base price of $103.95 million over the life of the 10-year contract.
Scoville said the proposed amounts are base costs. He said there will be fuel cost adjustments periodically over the next 10 years.
The other base rates proposed are: $123 million from “Utility 2”; $113.2 million from “Utility 3”; $115 million from “Utility 4”; $140.1 million from “Utility 5.” One of the companies submitted a second proposal which was for $149 million.
Alan Loveless, head of the city’s electric utilities, said the reason the amount proposed by each company was not provided was because of a confidentiality agreement signed by the city’s consultant, Ted Orrell of Utility Technology.
“He is comfortable with releasing the numbers showing the projected 10-year costs and savings, but he is not comfortable with identifying which company is associated with each cost,” Loveless wrote in an email. “The $11.1 million in savings that we mentioned in the press release is savings of Santee Cooper’s final proposal versus Santee Cooper’s standard rate. This indicates that they gave us a substantially better deal than we would have received if we had just re-signed with them without going through the competitive bidding process.”
Scoville said those savings will be passed on to the city’s customers.
“We accomplished what we set out to do a year ago by placing in the private competitive market a purchase proposal in which five large electric utilities responded,” Scoville said. “We have guaranteed our city electrical customers the lowest generation cost possible in the next 10 years.”

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