The latest increase, approved Wednesday by the S.C. Public Service Commission, is expected to raise more than $66.2 million in additional revenue.
Back in May, the company had requested an average rate increase of 2.99% that would have generated $70 million in additional revenue. The rate request was trimmed after being reviewed by the Office of Regulatory Staff, a state agency charged with looking out for the interests of consumers, as well as regulated utilities.
The rate increase will be effective for bills issues on or before Oct. 30, the company said.
The approved rate increases for various classes of customers are:
- 2.92% for residential customers, raising the monthly bill for a household using 1,000 kilowatt hours of electricity to $146.40 from $142.29.
- 2.91% for small commercial customers.
- 2.91% for medium commercial customers.
- 2.56% for larger commercial or industrial customers.
The commission’s approval of the rate hike request marks the seventh time since early 2009 that state regulators have approved an increase in electric rates under the Base Load Review Act. The law allows for annual adjustments to rates during construction of the units as a means of recovering financing costs associated with the project.
Two rate increases for new nuclear construction totaling 1.5% were approved in 2009, a 2.3% hike was granted in November 2010, 2.4% in November 2011, 2.3% in November 2012 and about 2.87% in September 2013.
Those rate increases do not include an overall 4.23% rate hike that went into effect in January to cover SCE&G electric generation costs and another 4.88% increase that went into effect in June 2010 to cover costs of complying with government-mandated environmental and safety initiatives.
Since 2009 SCE&G residential electric rates have climbed a total of 23.3%.
SCE&G and state-owned utility Santee Cooper are building two 1,117-megawatt reactor units near Jenkinsville, about 26 miles northwest of Columbia, for an estimated $9.8 billion. The utilities currently operate one 966-MW unit at the Fairfield County plant.
Paying financing costs while construction is underway compared with waiting until the project has been completed, should lower construction costs by about $1 billion, which in turn reduces by $4 billion the amount customers would pay through rates for related costs such as cost of capital, depreciation, property taxes and insurance, the company said.
The company’s costs are based on its existing 55% interest in the project, the documents said. However, SCE&G reported in January that it had signed an agreement with Santee Cooper to increase its share to 60%.
The project has been plagued by construction delays. Originally projected to be completed in 2018, the project could extend into the first quarter of 2020, according to commission documents.