Slide 1

Slide 2 Dependable Power. Dependable People. Slide 3 The mission of Santee Cooper is to be the states leading resource for improving the quality of life for the people of South Carolina. Slide 4 Santee Cooper is customer-focused with commitments to Low-Cost / Dependable Power Dependable People Quality Service Environmental Stewardship Slide 5 Santee Cooper Generation Jefferies Hydro 1, 2, 3, 4 & 6 - 1942 - 128 MW Moncks Corner Slide 6 Jefferies Steam 1 & 2 - Oil - 1954 - 92 MW Moncks Corner Jefferies Steam 3 & 4 - Coal - 1970 - 306 MW Santee Cooper Generation Slide 7 Winyah Steam 1 - Coal - 1975 - 295 MW Georgetown Winyah Steam 2 - Coal - 1977 - 295 MW Winyah Steam 3 - Coal - 1980 - 295 MW Winyah Steam 4 - Coal - 1981 - 270 MW Santee Cooper Generation Slide 8 Grainger Steam 1& 2 - Coal - 1966 - 170 MW Conway Santee Cooper Generation Slide 9 Cross Steam 2 - Coal - 1983 - 540 MW Cross Cross Steam 1 - Coal - 1995 - 620 MW Cross Steam 3 - Coal - 2007* - 580 MW * Projected Santee Cooper Generation Cross Steam 4 - Coal - 2009* - 580 MW Slide 10 Schedule for Additional Generating Capability Santee Cooper Generation Cross Steam 3 - Coal - 2007* - 600 MW Class Cross Steam 4 - Coal - 2009* - 600 MW Class Slide 11 Pollution Control Technology SO 2 NO X 7 coal-fired units scrubbed for SO 2 removal in GA, SC, & NC 5 of 7 are Santee Cooper units Santee Cooper has committed to: Install SCR Technology on Cross & Winyah Units and Low-NO X Burners on others Spend $280 M to comply with NO X SIP Call Requirements Slide 12 NSR Settlement JULY 2000 SANTEE COOPER, LIKE MANY OTHER COAL FIRED UTILITIES, RECEIVED A SECTION 114 REQUEST FOR INFORMATION REGARDING OPERATION AND MAINTENANCE OF ITS COAL FIRED UNITS FROM THE MID- 1970S TO THE PRESENT Slide 13 NSR Settlement 2000-2002 TIME FRAME -PROVIDED A LARGE NUMBER OF DOCUMENTS IN RESPONSE TO THE 114 REQUEST - BEGAN DISCUSSIONS WITH EPA REGARDING A POSSIBLE RESOLUTION THAT WOULD BE CONSISTENT WITH SANTEE COOPERS BUSINESS PLAN -NO RESOLUTION WAS REACHED DURING TIME FRAME -EPAS ENFORCEMENT POLICIES BEGAN SHIFTING Slide 14 NSR Settlement 2003-2004 TIME FRAME -SANTEE COOPER BEGAN PERMITTING PROCESS WITH EPA AND DHEC FOR CROSS UNITS 3 AND 4 -A BEGIN CONSTRUCTION ISSUE AROSE WITH SOME CONSTRUCTION ACTIVITIES AT THE PLANT SITE -DHEC, EPA CONTACTED SANTEE COOPER ABOUT POTENTIAL ENFORCEMENT ACTIVITY WITH REGARD TO NSR AND BEGIN CONSTRUCTION ISSUES -SETTLEMENT DISCUSSIONS RESUMED Slide 15 NSR Settlement MARCH 2004 SANTEE COOPER REACHED A SETTLEMENT WITH DHEC, EPA AND DOJ WHICH RESOLVES PAST AND FUTURE NSR LIABILITY, RESOLVES BEGIN CONSTRUCTION ISSUES AND IS CONSISTENT WITH ITS BUSINESS PLAN FOR FUTURE POLLUTION CONTROL CONSENT DECREE IS ENTERED JUNE 2004 Slide 16 NSR Settlement Certainty Operational Flexibility Opportunity to move forward with projects Agreement with EPA & DHEC provides: Slide 17 NSR Settlement Pollution Controls Civil Penalties Environmental Projects THREE MAJOR COMPONENTS Slide 18 NSR Settlement Santee Cooper has agreed to spend approximately $140 M on additional pollution controls: Scrubbers and Scrubber Upgrades for SO 2 Reduction Year-Round Operation of SCRs for NO X Reduction Additional PM Controls Slide 19 NSR Settlement Costs of Settlement Compare Favorably to Future Control obligations Largest Costs 2008 - 50M for Scrubbers at Winyah 1 and 2 2012 Possible Costs of 50 M for Scrubber Upgrades at Winyah 3 and 4 and PM Upgrades at Jefferies and Grainger Slide 20 NSR Settlement Benefits of Additional Controls SO 2 reductions allow significant savings in purchase of SO2 credits Additional controls allow fuel flexibility Pollutant reductions allow for permitting through netting process Slide 21 NSR Settlement Results of Additional Controls SO 2 Reductions of 50% (measured in lbs. per unit of electricity generated) NO X Reductions of 70% State of the Art Controls on nearly 90% of Santee Coopers coal-fired generation Slide 22 NSR Settlement - Civil Penalties Totaling 2 Million Dollars 1.3 Million to EPA .7 Million to DHEC -Environmental Projects Totaling 4.5 Million Santee Cooper has agreed to: Slide 23 NSR Settlement Environmentally Beneficial Projects - Land Conservation Project - Energy Efficient Technologies Project - Demand-Side Management Project - Clean-Diesel School Bus Retrofit Project - Environmental Management System Slide 24 NSR Settlement CHALLENGES OF SETTLEMENT - COMPLICATED CONSENT DECREE SUBJECT TO INTERPRETATION - LOTS OF RECORDKEEPING REQUIREMENTS -LOTS OF DEADLINES -LESS MARGIN FOR ERROR IN OPERATION Slide 25 NSR Settlement BENEFITS OF SETTLEMENT CLEAR PATH TO PERMITTING CROSS 3 AND 4 1100 Megawatts of New Coal Fired Generation Permit Unopposed and Un- appealed 1.4 Billion Dollars of New Construction Underway Since January 2004 Slide 26 NSR Settlement BENEFITS OF SETTLEMENT -Avoided Cost and Risk of High Profile Environmental Suit -Resolved Potential NSR Liability within Framework of Business Plan -Maintained Operational Flexibility -Maintained Support of Environmental Community Slide 27 NSR Settlement DOJ SAID ABOUT SETTLEMENT: Todays settlement again demonstrates this Administrations commitment to secure major pollution reductions from coal fired plants. The citizens of South Carolina will benefit from significant improvements in air quality. Santee Cooper deserves credit for stepping up to the plate and resolving this matter in a way that promotes the public interest. Slide 28 NSR Settlement EPA SAID ABOUT SETTLEMENT: The people of South Carolina will soon benefit from the responsible actions of Santee Cooper in cleaning up the emissions from their facilities Slide 29 NSR Settlement Light Reading -Consent Decree can be downloaded at www.epa.gov/compliance/resources/decrees Slide 30 Dependable Power. Dependable People.