It’s complicated, says one University of South Carolina expert.
Experts, policymakers and those on both sides of newly proposed energy legislation agree that South Carolina is, in fact, facing an increasing need for more electricity amid a rapidly growing population coupled with industry expansion and increased energy consumption by existing residential users. To tackle the need, lawmakers are considering a bill that, in part, would pave the way for Dominion Energy and Santee Cooper to build a large, jointly owned natural gas plant in Canadys, S.C., to come online within the next 10 years.
As of today — and even by 2037 — the state’s need for energy isn’t pressing, according to plans filed by Dominion and Santee Cooper.
But the utilities’ plans “project fairly significant load growth over the 15-year planning horizon,” said Andrew Bateman, acting director for the Office of Regulatory Staff, a state agency that represents the public’s interest in utility regulation.
In measuring demand, utilities continuously evaluate two metrics: generation capacity and peak demand.
Generation capacity is the amount of energy a utility has available to service its territory. Demand, or load, refers to the amount of energy consumed at any given point by residential, commercial and industrial users. Peak demand involves the amount of energy consumed during periods of extreme weather, such as exceedingly hot or cold days.
While there’s agreement that the state will need more electric power in the future, there remains uncertainty about predicting how much and disagreement about how to best meet whatever those future needs are. Answers to these matters hang in the air as state lawmakers decide how to proceed with the controversial energy bill before them.
Dominion’s capacity and demand forecast
Dominion currently has a generation capacity of approximately 5,600 megawatts. This includes what’s known as “dispatchable” energy, that is, energy the utility can control, which is made up of coal, natural gas and nuclear energy. Of its “undispatchable” electricity, namely solar energy, Dominion has 1,200 megawatts on its system, but it cannot control when that power is available because of the need for sunlight.
Dominion’s peak demand on a sunny day — with temperatures between 50 and 70 degrees — comes in around 2,650 megawatts on average, according to the utility. On extremely hot or cold days, however, the load spikes at an average of 4,700 megawatts.
By 2037, Dominion projects that its summer and winter peak demands will be around 5,595 and 5,332 megawatts, respectively.
Kellar Kissam, president of Dominion Energy South Carolina, emphasized his utility “obligation to serve.” Doing so, he says, requires Dominion to steadily secure a sufficient supply of energy, of which he believes the proposed energy bill will help to do amid anticipated increases in demand.
Santee Cooper’s capacity and demand forecast
Santee Cooper has a generation capacity of about 6,000 megawatts, which include long-term purchase power agreements with other utilities.
Its daily demand, on a sunny day with mild temperatures, hovers around 3,300 megawatts, while peak demand is about 5,350 megawatts, which usually occurs during the winter season, according to Santee Cooper’s Integrated Resource Plan.
Indeed, in the winter of 2022 during Winter Storm Elliott, Santee Cooper (and Dominion) faced a challenge when the demand for electricity coupled with infrastructure issues threatened to overtake their capacity.
Facing a peak of 5,432 megawatts during the storm, Santee Cooper initiated a rolling blackout during the early morning hours of Dec. 24, 2022. The event impacted about 12,000 customers for 15 minutes before the utility was able to begin restoring service, according to Santee Cooper spokesperson Mollie Gore.
Last year, Santee Cooper increased its generation capacity by purchasing a natural gas plant in Cherokee County that provides about 100 megawatts. It has also contracted for an additional 250 megawatts in purchased power from out-of-state, according to Gore.
“That additional 350 megawatts on our system helped us successfully meet a similarly large customer demand earlier this year, when once again temperatures plummeted,” Gore said. “As our customer demand continues to increase, we will need to add generation to continue meeting needs, and we will do so.”
Santee Cooper projects that by 2037, peak demand is estimated at 6,784 megawatts, according to its load forecast report.
Predicting the future is a ‘tricky’ endeavor
Measuring future energy demands is a “tricky” endeavor, according to energy expert and geographer Conor Harrison of the University of South Carolina.
That’s because, Harrison says, predicting future energy needs involves multiple factors, among a diverse range of consumers.
“Future energy projections are really tough and are usually wrong,” he said. “When (utilities) are projecting, they don’t want to be wrong on the low side, but those projections should also be taken with a grain of salt. Their goal is to make sure they have more than enough power — and they’re also compensated more if they have more than enough power — so it’s a sort of tricky game.”
Forecasts of the need for more power have been used before to justify large, expensive energy projects.
The most notable occurred more than 15 years ago, when Santee Cooper and Dominion’s predecessor, SCE&G, proposed building two new nuclear reactors in Fairfield County north of Columbia.
Both utilities scaled back their forecast for peak energy demands from 2009 to 2017 for a variety of reasons, including customers becoming more energy efficient. But as they were scaling back the demands, they continued to move ahead with the nuclear plant expansion project at the V.C. Summer nuclear station.
In July 2017, the utilities walked away from the project after spending $9 billion and raising customer rates to pay for the reactors. Two utility executives were later prosecuted criminally after critics said they misled the public and shareholders.
Harrison said the demand for electricity in most parts of the U.S., including South Carolina, has remained relatively steady for the past 20 years across residential, commercial and industrial users. Peak demands, however, are gradually climbing.
“The drivers of peak demand are typically residential users,” he said. “Temperatures are getting hotter, and if air conditioning is the biggest thing we use to combat the heat, our peak is going to go up.”
Half of residential demand comes from air conditioning (either during the summer or winter) and water heating, according to Harrison.
Another factor utilities grapple with in measuring demand involves taking old plants offline and reconciling lost energy.
In the interest of creating more clean energy, Dominion, for example is planning to close two coal plants that generate about 1,700 megawatts.
“We need a new generation resource to help replace the two coal plants still on our system, to support more solar on the system and to be prepared for continued growth including the potential for additional load-heavy industrial customers like Scout and Google,” Dominion spokesperson Rhonda O’Banion said.
Data centers are ‘energy hogs’
Critics of the House energy bill, including a former Public Service Commissioner who recently resigned from the PSC in protest of the bill, say the state could help alleviate its need for more energy by limiting the construction of data centers around the state.
“One legislative solution would be to put a temporary freeze on building new data centers and crypto mining companies until South Carolina can catch up with needed electricity generation,” Tom Ervin, PSC commissioner, said in a letter. “These data centers and crypto miners are energy hogs.”
South Carolina currently has 16 data centers, according to a report by Baxel.
Last September, Gov. Henry McMaster announced another center, QTS Data Center, plans to open in York County.
H. 5118 and timely demand
Whether the House bill being debated will meet the state’s energy needs in enough time by supplying a new gas plant is unknown. Bateman, of the Office of Regulatory Staff, says he thinks it will, based on one of the bill’s provisions.
The provision says, “This plan must identify recommended actions over a 10-year period to ensure the availability of adequate, reliable and economical supply of electric power and natural gas to the people and economy of South Carolina.”
“I do think (H) 5118 is looking to address the energy needs of the state now and in the future,” Bateman said.
Staff writer Sammy Fretwell contributed to this story.