Santee Cooper signs its largest customer to 45-year extension
Originally published May 28, 2013
Santee Cooper signed a multi-billion-dollar, 45-year extension of an agreement to sell power to its largest customer, the Central Electric Power Cooperative, the wholesale electricity aggregator for 20 independent retail electric cooperatives. With this amendment, the contract between the two entities cannot be terminated prior to 2058, Santee Cooper said.
The boards of both organizations approved the agreement in separate votes. The savings from the extension will benefit all cooperative consumers as well as other wholesale customers and direct-served residential, commercial and industrial customers of Santee Cooper, the state-owned utility said. Financial terms of the new agreement were not disclosed.
"Today is a win for South Carolina, which has enjoyed the fruits of our partnership with Central for more than 60 years already," said Santee Cooper President and CEO Lonnie Carter. "One immediate benefit of this extension is it will provide the credit agencies the stability that they need as they evaluate our bonds. This should translate into lower interest rates on our debt, which helps us keep power costs low for all our customers."
"Today’s signing puts in place significant changes that will help make our two organizations partners in power supply planning and delivery," said Central President and CEO Ronald J. Calcaterra. "It will be a true and effective partnership that aligns the interests of both parties." The amendment is noteworthy also because of its influence on electricity rates for the more than 2 million South Carolinians who use power from either electric cooperatives or Santee Cooper.
"More than a year ago, the board directed staff to push hard for long-term rate and contract improvements and board members were unanimous in their approval of that hard work," said Lawrence J. Hinz, Central’s board chairman. "Congratulations to the staffs of both organizations for working together for the good of all."
Santee Cooper and electric cooperatives in the state last year announced a new discounted economic development rate designed to attract large industry to South Carolina. The cooperatives and Santee Cooper also jointly fund the South Carolina Power Team, which they said is the only statewide non-governmental economic development organization. Since its founding in 1988, the Power Team has participated in more than 600 industrial expansions and new developments representing $9.3 billion in capital investment, more than 52,400 new jobs and $2 billion in annual payroll, Santee Cooper said.
"From providing electricity to every corner of the state, to our work with the Power Team and renewable Green Power, we’ve delivered many groundbreaking projects already," said O.L. Thompson, chairman of Santee Cooper’s board of directors. "Today’s signing signals more opportunity ahead for what is truly a powerful partnership."
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