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The value of municipal power systems

Municipal power systems can offer distinct benefits to cities and their residents — from the power of teamwork after a storm to lower rates to economic development support.

City of Clinton utility employees assisting City of Bennettsville
City of Clinton utility employees responded to Hurricane
Matthew's aftermath in the City of Bennettsville. Photo: City of Clinton.

Like local schools, hospitals or parks, municipal power utilities are community-owned, not-for-profit institutions. Both in South Carolina and the United States, approximately 14 percent of electric customers are served by public power.

In South Carolina, 170,000 residential and business customers in 21 cities and towns receive their power from municipal power systems, which range in size from 360 to 37,000 customers. All 21 municipal power systems are members of the South Carolina Association of Municipal Power Systems.

So what makes municipal power systems different?

Local accountability, local investment
In municipalities operating power systems in South Carolina, the voters in the city elect the council or governing board responsible for operating the electric utility. Because of the local nature of municipal power systems, customers get quick responses to issues. And since public power utilities operate under the state's  open government laws, customers can bring any opinions or concerns to an open meeting of the municipal council or governing board.

Customers have a direct say in how the operation is run and how rates are set, said Coleman Smoak, the retired general manager of the Laurens Commission of Public Works and current general manager of Piedmont Municipal Power Agency. In fact, for public power utilities, residents' input helps determine electric rates, investment decisions about new technology, appropriate staffing levels and energy savings initiatives.

"We are self-regulated by our elected commission in terms of rates," said Joel Ledbetter, general manager of Easley Combined Utilities. "We're in business for the people who own us — the people in the city. We are not in business for returns or dividends of stockholders. We're working directly for the owners."

Municipal power systems come with one more public-accountability attribute: Transparency. If customers want to learn more about some aspect of their power provider, the S.C. Freedom of Information Act requires that the system's nonexempt records be open. This level of transparency is unique to municipal power.
 
Responsiveness is another advantage. "Local linemen and support staff also ensure residents and businesses receive more reliable and responsive service," Ledbetter said. "The crews are located in the City of Easley, so they can quickly respond to service calls, as opposed to investor-owned utilities, where crews may come from another city, county or sometimes state."

The American Public Power Association has found that local public power utilities often support numerous programs in their community, including charitable, education and beautification efforts.

"We're closer to our people," Ledbetter said. "We invest back in the community."

Because most SCAMPS utility-member employees work and live in the city or town they serve, the community benefits from the employees' reinvestment of wages in the local economy.

More than electric
Most municipal power systems in South Carolina provide one or more other utilities such as water, sanitary sewer, or even natural gas, in addition to electric service.

"It's more efficient to integrate utilities and combine engineering staff, equipment, and administrative functions and personnel," said Ledbetter.

Customers benefit from the convenience of receiving a single bill for the combined utility services and making one payment each billing cycle. A combined municipal utility system also offers the advantage of a one-stop shop, which allows new customers looking to establish service or wanting to ask questions to communicate with a single entity.

Economic development and public power
Local ownership gives the utilities' governing bodies the flexibility to tailor rate and policy decisions to support economic development projects.

"Economic development prospects like working with a combined utility because it streamlines navigating technical and environmental regulations and permitting," said Eric Budds, the Municipal Association's deputy executive director responsible for SCAMPS. "Most municipal power systems work closely with county economic development offices and regional economic development alliances."

Some utilities, such as the City of Clinton's, have built industrial parks that leverage the one-stop shop and service provider concept to enhance economic development recruitment.

Sister cities unite
SCAMPS offers strength in numbers for the 21 municipal electric systems. Collectively, these systems employ approximately 150 linemen and work collectively through SCAMPS, share technical expertise, train staff and advocate for state and federal policies that support public power. These systems also team up to restore power in response to severe weather events as members of a state, regional and national mutual aid network.

In the wake of Hurricane Irma in September, 66 employees from SCAMPS member utilities volunteered to help restore power in communities impacted by the hurricane. Fifty-nine employees assisted the Jacksonville Energy Authority, while seven employees helped the Georgia cities of Conyers and Sandersville repair their electric systems. 

In October of 2016, Hurricane Matthew left 25,000 customer outages in its ferocious wake. Restoring power to the three member cities — Bennettsville, Georgetown, and Orangeburg — was possible because of an intense SCAMPS-led effort to mobilize 140 people representing electrical personnel from Alabama, Florida, North Carolina and Nebraska.

"The Hurricane Matthew response demonstrated the effectiveness of the mutual aid network and the dedication of the SCAMPS linemen, support personnel, and management personnel who mobilized as part of the effort," said Budds.

The American Public Power Association celebrates Public Power Week the first full week in October every year.