Dominion Energy/SCANA Merger Could Boost South Carolina Economy by $18.7 Billion
Dominion Energy/SCANA Merger Could Boost South Carolina Economy by $18.7 Billion
- Payments, lower rates for SCE&G electric customers would create jobs, wages and retail sales
- Charleston, Richland, Aiken, Dorchester and Beaufort counties top beneficiaries
- Economic boost to be felt in 24 South Carolina counties in all
COLUMBIA, S.C., April 17, 2018 /PRNewswire/ -- South Carolina could see more than $18.7 billion in increased economic output from the proposed merger of Dominion Energy, Inc. (NYSE:D), with SCE&G and its corporate parent, SCANA Corporation (NYSE: SCG), according to a new study done by one of the state's leading economists.
The benefits come from Dominion Energy's plan to provide direct cash payments and lower electric rates to SCE&G electric customers as well as the additional benefits created as the cash payments and customer savings work their way into the South Carolina economy.
The study was performed by Dr. Joseph C. "Joey" Von Nessen, a research economist in the Division of Research at the Darla Moore School of Business at the University of South Carolina.
"The benefits of the Dominion Energy proposal go well beyond the immediate value of the $1.3 billion in cash payments to SCE&G electric customers," said Thomas F. Farrell, II, Dominion Energy chairman, president and chief executive officer. "The payments and the extra money in customers' pockets from the lower rates will flow into the local economy in the form of billions of dollars in increased retail sales, new jobs, added wages and business investment."
In addition to the cash payments - equal to about $1,000 for the average SCE&G electric customer - Dominion Energy proposes to reduce electric rates by about 7 percent after the merger closing. It also would absorb $1.7 billion in costs for the abandoned V.C. Summer new nuclear project and purchase a natural gas-fired power station at no cost to customers.
Farrell noted that some businesses would receive cash payments into the millions of dollars, providing funds for new capital investments. Non-profit organizations, government agencies and other electric customers also would benefit from the cash payments and lower rates.
Labor income alone is expected to increase by approximately $4.6 billion for South Carolinians. This would be the result of customer savings being spent in the local economy, boosting overall demand, and creating "additional employment opportunities associated with new contract labor, an increase in the number of hours for existing workers, and both temporary and permanent hires," the study found.
Dominion Energy previously identified more than $12 billion in customer benefits resulting from the cash payments, lower rates and reduced time customers would pay toward the abandoned nuclear project. The study takes into account that customers would then put much of the new money into the economy.
"This $18.7 billion total economic output estimate represents an economic multiplier or ripple effect of approximately 1.49," Dr. Von Nessen said. "In other words, for every $100 that is provided to Dominion/SCANA customers in savings, it is estimated that a total of $149 in new economic activity will be generated across South Carolina."
Five South Carolina counties could see economic benefits totaling more than $1 billion each. Charleston would see the greatest benefit, $4.9 billion. It is followed by Richland, $4.2 billion; Aiken, nearly $2 billion; Dorchester, $1.2 billion; and Beaufort, $1 billion. In all, the benefits would be seen in 24 counties in the state where SCE&G provides electric service. Benefits are based on the amount of electric sales in each county.
Economic Impact by County
-------------------------
County Added Economic Output County Added Economic
Output
------ --------------------- ------ --------------
Abbeville $16,022,372 Fairfield $105,450,280
--------- ----------- --------- ------------
Aiken $1,966,540,844 Greenwood $1,307,387
----- -------------- --------- ----------
Allendale $147,402,524 Hampton $166,372,956
--------- ------------ ------- ------------
Bamberg $63,546,375 Jasper $152,810,359
------- ----------- ------ ------------
Barnwell $177,095,282 Kershaw $5,626,104
-------- ------------ ------- ----------
Beaufort $1,015,849,531 Lexington $2,553,974,972
-------- -------------- --------- --------------
Berkeley $699,123,634 McCormick $29,512,198
-------- ------------ --------- -----------
Calhoun $305,319,564 Newberry $58,677,217
------- ------------ -------- -----------
Charleston $4,909,216,395 Orangeburg $240,550,253
---------- -------------- ---------- ------------
Colleton $258,009,612 Richland $4,226,925,205
-------- ------------ -------- --------------
Dorchester $1,226,205,050 Saluda $147,332,205
---------- -------------- ------ ------------
Edgefield $214,637,699 Union $21,265,245
--------- ------------ ----- -----------
Dominion Energy and SCANA are in the process of obtaining regulatory approvals for the merger. Approval has been received from the Georgia Public Service Commission and the Federal Trade Commission granted early termination of the 30-day waiting period under the federal Hart-Scott-Rodino Antitrust Improvements Act. The merger is also contingent upon approval of SCANA's shareholders; review and approval from the public service commissions of South Carolina and North Carolina; and authorization of the Nuclear Regulatory Commission and Federal Energy Regulatory Commission.
About Dominion Energy
Dominion Energy is one of the nation's largest producers and transporters of energy, with a portfolio of approximately 26,000 megawatts of electric generation, 14,800 miles of natural gas transmission, gathering and storage pipeline, and 6,600 miles of electric transmission lines. Dominion Energy operates one of the nation's largest natural gas storage systems with approximately 1 trillion cubic feet of storage capacity and serves nearly 6 million utility and retail energy customers. For more information about Dominion Energy, visit the company's website at www.dominionenergy.com.
About SCANA
SCANA Corporation, headquartered in Cayce, S.C., is an energy-based holding company principally engaged, through subsidiaries, in electric and natural gas utility operations and other energy-related businesses. Information about SCANA and its businesses is available on the company's website at www.scana.com.
Forward-looking statements
This release contains statements that constitute forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. The statements relate to, among other things, expectations, estimates and projections. We have used the words "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "plan," "outlook," "predict," "project," "should," "strategy," "target," "will," "would," "potential" and similar terms and phrases to identify forward-looking statements in this release. Factors that could cause actual results to differ include, but are not limited to: the expected timing and likelihood of completion of the proposed acquisition of SCANA, including the ability to obtain the requisite approval of SCANA's shareholders; the risk that Dominion Energy or SCANA may be unable to obtain necessary regulatory approvals for the transaction or required regulatory approvals may delay the transaction or cause the parties to abandon the transaction; the risk that conditions to the closing of the transaction may not be satisfied; or the risk that an unsolicited offer for the assets or capital stock of SCANA may interfere with the transaction. Other risk factors for Dominion Energy's and SCANA's businesses are detailed from time to time in Dominion Energy's and SCANA's quarterly reports on Form 10-Q or most recent annual report on Form 10-K filed with the Securities and Exchange Commission (SEC).
Important additional information
In connection with the proposed transaction between Dominion Energy, Inc. and SCANA Corporation, Dominion Energy has filed with the SEC a registration statement on Form S-4 that includes a combined preliminary proxy statement of SCANA and preliminary prospectus of Dominion Energy, as well as other relevant documents concerning the proposed transaction. The registration statement has not yet become effective and the proxy statement/prospectus included therein are in preliminary form. The proposed transaction involving Dominion Energy and SCANA will be submitted to SCANA's shareholders for their consideration. This communication shall not constitute an offer to sell or the solicitation of an offer to buy any securities nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction. Shareholders of SCANA are urged to read the registration statement and the preliminary proxy statement/prospectus regarding the transaction and any other relevant documents filed with the SEC, as well as any amendments or supplements to those documents, because they will contain important information.
Shareholders are able to obtain a free copy of the preliminary proxy statement/prospectus, as well as other filings containing information about Dominion Energy and SCANA, without charge, at the SEC's website (http://www.sec.gov). Copies of the preliminary proxy statement/prospectus and the filings with the SEC that will be incorporated by reference in the preliminary proxy statement/prospectus can also be obtained, without charge, by directing a request to Dominion Energy, Inc., 120 Tredegar Street, Richmond, Virginia 23219, Attention: Corporate Secretary, Corporate.Secretary@dominionenergy.com or to SCANA Corporation, 220 Operation Way, Mail Code 0133, Cayce, South Carolina 29033, Attention: Office of the Corporate Secretary, BoardInformation@scana.com.
Participants in the solicitation
Dominion Energy, SCANA and certain of their respective directors, executive officers and employees may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction. Information regarding Dominion Energy's directors and executive officers is available in its definitive proxy statement, which was filed with the SEC on March 20, 2017, Dominion Energy's Annual Report on Form 10-K, which was filed with the SEC on February 27, 2018, and certain of its Current Reports on Form 8-K. Information regarding SCANA's directors and executive officers is available in its definitive proxy statement, which was filed with the SEC on March 24, 2017, SCANA's Annual Report on Form 10-K, which was filed with the SEC on February 23, 2018, and certain of its Current Reports on Form 8-K. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the proxy statement/prospectus and other relevant materials filed with the SEC. Free copies of these documents may be obtained as described in the preceding paragraph
CONTACT: DOMINION ENERGY CONTACTS: Media: Chet Wade, (804) 921-0511 or Chet.Wade@dominionenergy.com; Financial analysts: Steven Ridge, (804) 929-6865 or Steven.D.Ridge@dominionenergy.com; SCANA CONTACTS: Eric Boomhower, (800) 562-9308 or eboomhower@scana.com; Financial analysts: Bryant Potter, (803) 217-6916 or addison.potter@scana.com
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SOURCE Dominion Energy
