Posted On March 13, 2019
Renewable energy continues to be a hot topic in South Carolina, and it has the potential to add fuel to economic development efforts. Legislation known as the “South Carolina Energy Freedom Act” (H. 3659), which would open energy markets to independent power producers, passed unanimously in the state House in February and now is moving through the Senate.
In South Carolina, 1.6 percent of electricity generated comes from renewable resources, such as biomass, geothermal, solar and wind. As renewable energy becomes more affordable and environmentally friendly, demand continues to rise from business and residential consumers alike.
Supporters of the bill are urging policymakers to remove what they say are barriers to economic development so South Carolina can continue its success in recruiting businesses to the state. They say the legislation would benefit corporate energy consumers in several ways, including:
1. Allowing large energy consumers, such as industrial manufacturers, to negotiate directly with a renewable energy supplier to more easily realize savings from renewable energy;
2. Requiring utilities to file a voluntary renewable energy program for commercial and industrial customers that will be reviewed and approved by the Public Service Commission without shifting costs to other customers; and,
3. Requiring the PSC to initiate a new proceeding to review and approve rates and terms provided to large-scale solar facilities. This would streamline the process and ensure contract terms are reasonable for such projects.
The bill also would help residential customers over the next two years by lifting a cap on “net metering,” which allows homeowners with rooftop solar installations to get credit for the electricity they produce.
Since the 1930s, when electrification occurred in the rural South, power companies have enjoyed the grant of a monopoly. The bill now moving through the Legislature signals a groundswell of demand for affordable, environmentally friendly energy and could open the door to more choices for South Carolina consumers.
Renewable energy has become a significant economic development tool for South Carolina. While corporations looking to establish their businesses in the state have traditionally considered tax incentives, schools and a trained workforce as important factors, now the availability of cheap, clean power has become a priority as well.
If the bill passes, large industrial customers would be able to source “green” power directly from a generating plant and the industrial customer will receive a credit on their bill for the avoided cost of that energy. Developers would also be able to make a case for rates and terms of power purchase agreements to make financing projects viable.
More than two dozen corporations have publicly expressed support for the bill. The list includes global companies such as Walmart, The Home Depot and Hilton, as well as manufacturers in South Carolina, such as Milliken and Volvo, which has built its largest North American plant in Ridgeville.
South Carolina companies exploring renewable energy opportunities can benefit from strategic advice from the right legal team. Turner Padget attorneys have experience in helping clients navigate federal, state and local regulations, which are continuing to evolve in the renewable energy industry.