SCE&G and VC Summer: By the numbers
Current and former customers of SCE&G will get up to $146 million in refunds for an unfinished power plant as part of a $2.2 billion legal settlement approved Tuesday by a judge.
And the attorneys who argued the case for ratepayers will take home $51 million — plus $865,000 to cover their expenses — for their work negotiating what is believed to be the largest private class action settlement in South Carolina history.
Circuit Judge John Hayes’ approval of the settlement ends a 22-month legal fight over SCE&G’s failure to finish the construction of two new reactors at the V.C. Summer nuclear power plant in Fairfield County.
The failed nuclear project already has cost the Cayce-based utility’s customers more than $2 billion in the form of higher power bills. And over the next 20 years, those customers will pay another $2.3 billion for it to the utility’s new owner, Virginia-based Dominion Energy.
The $2.2 billion settlement approved Tuesday includes $2 billion in future rate relief — in the form of lowered power bills — that Dominion offered in its bid to purchase SCE&G. It also includes a pot of up to $200 million that will pay for customer refunds and attorneys’ fees. That pot will be filled with $115 million in cash that SCE&G originally set aside for executive golden parachutes and up to $85 million from the sale of former SCE&G real estate.
The first checks — distributing the $115 million in cash — could be sent out to current and former SCE&G customers later this summer, after a 30-day appeals period has passed and the court has appointed a settlement administrator to oversee the payouts. Another round of checks will be sent out to the same customers once the real estate has sold, a process that could take a year or more.
Customers who don’t want a check will be able to get their payout in the form of credit on their next power bills.
The pot will be split amongst 886,554 current and 742,193 former SCE&G customer accounts. The amounts they receive will be pro rated based on how much they were charged over the years for the useless nuclear project.
In his written ruling, Circuit Judge John Hayes praised the attorneys who fought SCE&G in a legal case that “was unparalleled in South Carolina legal history” in scope and complexity.
The 13 law firms that handled the case spent 26,000 hours building their case that the Cayce-based utility mismanaged the massive nuclear project and kept the failing venture alive in order to reap profits and executive bonuses.
“It is inescapable that Class counsel (the attorneys) were able to achieve a class resolution that many thought improbable at the outset,” Judge Hayes wrote in his ruling. “While their efforts do not totally compensate for the years of customer nuclear charges, they achieved a result that the Court finds is eminently ‘fair, reasonable and adequate,’ for which they deserve a significant fee.”
In a statement, one of those attorneys, Ed Westbrook, wrote “We are extremely pleased to have helped achieve an unprecedented amount of rate reduction and refunds for SCE&G’s customers. ... From the beginning, our focus has been to get the best result possible for SCE&G’s customers in this extraordinarily difficult litigation against an enormous powerful company. We believe the comprehensive settlement the court has approved more than meets that goal and we are proud to have achieved it.”
The $51 million in fees awarded to attorneys in the settlement was $15 million less than the amount the ratepayer attorneys initially requested from the settlement pot.
The attorneys agreed to take less money after Columbia attorney Robert Dodson formally objected to the attorneys’ fees, arguing in court that $66 million was far too high and that ratepayers were being shortchanged.
Dodson withdrew his objection after the attorneys agreed to knock $15 million off their fees.
Since Dodson’s intervention saved that money for ratepayers, Judge Hayes allowed him to take $3 million of it for his own fees. The other $12 million will go to ratepayers.
The law firms that negotiated the settlement are the Strom Law Firm; Richardson, Patrick, Westbrook and Brickman; Bell Legal Group; Speights and Solomons; Lewis Babcock; Savage, Royal and Sheheen; McGowan, Hood and Felder; Coleman and Tolen; Galvin Law Group; McCallion and Associates; Holman Law; Janet, Janet and Suggs; and Law Offices of Jason E. Taylor.