Text

New Directions,Santee Cooper 1987 Annual Rept
	ML20148A835
Person / Time
Site:	Summer
Issue date:	12/31/1987
From:	Holder D, Mescher W; SOUTH CAROLINA PUBLIC SERVICE AUTHORITY (SANTEE COOPE
To:	;
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ML20148A797	List: ML20148A793; ML20148A835; ML20150C684;
References
	NUDOCS 8803210183
	Download: ML20148A835 (56)
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1 Table of Contents Financial Summary. .. i Economic Development.. . 20 Corporate Statistics. .. ii Fhxxl Control. . 22 Comparative flighlights. .3 Stosquito Abatement. .22 Alission. 3 Water Quality Alanagement. . 22 ..;r, e.v._. Chairman and President's l etter. .4 Aquaculture. .23 - - @$,/2. Energy Sales. .6 Iloniculture. .23 ww. ;.. . p.f,4li.;; %-. Distribution. Property Management. . 23 ~ i-r4i .p 'Oi.[.M.:a.y Energy Stanagement. .9 Program for Employee " ' '-l'f."[ Generation and load Growth. .10 Panicipation.. . 25 j.-[j.{.k 'h[ Nuclear Power. .10 l{uman Resources. . 25 {. 'h;l 2 System Planning. .10 Occupational 11ealth. . 26 Engineering and Construction Training and Development. .26 d ~ 31anagement. .I1 Safety . 26 Performance and Environmental Corporate Forecasting. Rates. Services. .I1 and Statistics. . 27 Generation and Transmission Alanagement Information Systems.. .28 System. 11 Treasury. 30 Production Operations. .12 Schedule of Ilonds Outstanding. . 31 Power Generating Stations.. .14 Schedule of Refunded Sonds.. 34 ~ Power Supply .17 Applications of Revenue. . 35 Design Engineering. .18 Financial Statements. 36 General Construction. .18 Auditor's Repon.. . 37 =[- -.s_ ~ Transmission Operations. .19 Board of Directors, Advisory lloard, Project Alanagement. .19 and Alanagement. .llack Cover Reliability. .19 Corporate Communications. .19

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i 1,. I l-l l l' t I \\ 1 m ./ \\ t l,on1]MirilIt'e com-Sunrise on Soe j ///gh//gh/S Carolinah coastal plain. A new day - and new i l nscR M N M "cMGE directions for Santee i %. c e e,< w.w m y." Cooper, Son Camlinah l Arv An" state-owned public power , +ses r m m.s [ . W..'.ah y 1/ if ';'?1 5 21 [g$QUg, "M 6 y +m.. na - Directions"is the theme , o s... m.o. ,a a of g or w w.. ww s* * ' Santea Coopert histodc cw ng, s# % w w 'e + us commitments to service r j E m Ok<ON and sigWardship and10 an E.we sw u x sw m n l expanding miein helping amn~

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~ to shape the dynamic wwws s ap sw x p,>s future of the Palmetto cmtoA nt* sasdb-sfso<.m State. Members of Santee en.*me w, m nu Enem, Se Coopert management ms,a.n "w a in ::e,m a team express the new % e,y. # directions being taken for I m omer s.e 7mto s: in i t9 ' eme% emples, wea %usE bondholders and the mer.e. c e3 2 24 o I cuamm m m .comE lemtone Nk Denux1 2123 2006 5 83 Inep.,atts) 4 l 3

1.r_ A = a E T 1s i_= 4 4 E 1 k 4 gi I , u 8 a ke w R l E m m r_ mar i-emerxm mt,ent IN < ine (if t he hest Jnd mt WI lH illles. W as H )intly ( >fleral l [f((UT t hallenging m santee to < >ur t ust< >me rs a nd u. 1 hI (i x sper s hist < >r3 l b >w - ('er'ral i let tra (i x >Trra- /ront the es er..,u r greatest am om-ns e. int in n ogmomo or d C'ha t't.niait plishlilents W ere n( >t in the L ()mpan\\ s energ\\ lf int reased sales v it cln trn - u >nsers ato >n et torts. k allc/lhe a but m "ur re'r"n'e u " santee ( " rcrre<caca e fbbf[ bf[! ers and the pet )ple ( >I ( Mir l'( 'W ef.\\ W % IJ t M in N state annu..l Energy inn. A ator ( )ar residennal rate ss s \\w a rd het < >mme t he lu st icm u as res 1 sed U > nu ire puhht p in er w stem in ( M-t 'I Ille naII in I i In eB e IIlls ta'd\\ ITalafh e !!)e t sen n e t, e ut s ear-r< >und

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} t j l e. i. 1 I { power costs to our three will continue to generate in partnership with the i . largest industrial custom-the pon er for the t 'ps State Department of Parks, I ers: Alumax of South to sen e these indt.. ies. Recreation, and Tourism, Carolina, Georgetown This legislation redefined began deve topment of the Steel, and.\\lacalloy the economic develop-Old Santee Canal State ; Corporation. As a result, ' ment roles oflx>th Santee Park. Visitors will be able all three finns returned to Cooper and the co-ops to wander through the full prcxtuction and and marked the beginning natural environment of a employment. of a new era of coopera-Biggin Swamp and see a f The number of retail tion between Santee. section of the historical l customers served in-Cooper, Central, and its 15 watenvay constructed in creased 5.1 percent to member co-ops A joint 1796 as the first canal in 81,950 during the fiscal economic development this country connecting year. Energy use by program to incorporate two major river systems. wholesale customers the new legislation, inte-Design of the park is com-increased by 12.2 percent, grated communications plete, and construction use by retail customers and marketing, and a will begin in the near increased 10.3 percent, shared energy conserva-future. and industrial use grew tion program are the be-New directions, new 3.5 percent. ginnings of a new alliance goals, and continued suc-While load gromh was between Santee Cooper cess in service to our cus-responsible for a 6 percent and the cooperatives. tomers, our bondholders, rise in revenues over last This reaffirms S;mtee and the people of the state year, ekctric operating ex-Cooper's commitment to will be the primary mis-k penses increased only 4 its mission of supponing sion of Santee Cooper dur-percert And this year's economic development ing the coming year. advance refunding of and job creation efforts in bond issues caused a 51.8 the state. million reduction in inter-Also this year, another ~ est charges. This saving new direction for the com-Dwight A. Ilolder helped to produce rein-pany was established with a> airman (fibe Ikwn/ vested camings of S 10.3 the passage of legislation million on gross revenues authorizing Santee Cooper e of $505.3 million. to ent the wholesale wa-k/d d. M Although legislation ter supply business, selling Wiiam C. Mescher was passed this year potable water from the N/ dent and d d" M " "'"*' @ " which restricted our right lake system to entities in to serve new industrial five counties. customers k>cating in For the xcreational areas assigned to Central's benefit of the people of electric cooperatives, we our state, Santee Cooper, 5

1 i The average cost per previous year. The ENERGYSALES kilowatthour for Santee average cost of power to Cooper residential custom-industrial customers was - At the end of the fiscal ers was 6.52 cents,.9 2.95 cents per kilowatt-year, Santee Cooper was percent higher than the hour,3.9 percent less than serving 81,950 residential, previous year, but 12 the previous year and 37 commercial, and othei percent lower than the percent lower than the retail customers located national average. national average. A signifi-in lierkeley, Horry, and The average cost of cant portion of this de-Georgetown counties. power for Santee Cooper crease resulted from the -This was an increase of commercial customers was temporary rate relief 3,950 or 5.1 percent over 5.72 cents per kilowatt-provided to Santee the previous year. Of this hour, down.5 percent Cooper's three largest increase,3,540 were from 1986 and 20 percent industrial customers, all residential and 410 were lower than the national suffering from a depressed commercial. This com-average. metals market, pares with growth in 1986 Industrial sales were Sales to U.S. Air Force of 4,140 residential and 4,717 gigawatthours, up bases at Charleston and 210 commercial. 3.5 percent over the Sales to these retail customers v ere 1,725 gigawatthe ars, up 10.3 gg l percent o' er the previous g,f 7,jggfg.jg year. Thi, compares to last year s growth in Industrial 4.716,882 40.62 % 4 energy: ales of 8.5 per-commercial 892,123 7.68% cent. Residential 804.154 6r2% i x The average annual Military 440.978 3.80 % consumption of electricity Municipals 28,651 0.25%-- by Santee Cooper resi-wholesale 4,729,540 40.73 % dential customers in-creased to 12,195 kilo-l watthours,5.2 percent " C##I " l N ## M more than the previous year and 34.5 percent industrial 4.557,796 42.29 % greater than the national commercial 812.520 7.54 % l average. Residential 720.438 6.68 % Military 443.064 4.11 % Municipals 30.500 0.28 % 4holesale 4.214,322 39.10 % 6

l l l b i Alyrtle 11each and to the last year's total of 78,000, located in Slynle lleach. Charleston Naval Station for an increase of 5.1 per-To improve the system, decreased.5 percent from cent. Energy sales for the gather planning data, and 443 gigawatthours to 441 year totaled 1,725 gigawatt-increase customer service gigawatthours. hours with revenue of reliability in the division, a ) Sales through Central $ 105,106,599. distribution Supervisory Electric Power Ccx)pera-The Hony-Georgetown Control and Data Acquisi-tive, Inc. to its 15 member Division serves the Grand tion (SCADA) system was co-ops increased 12.5 Strand resort area, a top purchased. A master work-percent to 4,589 gigawatt-vacation spot, which station and 9 remote tenni-hours. Central is Santee boasts more than 13 mil-nal units were received for Cooper's largest single lion visitors annually, over the SCADA system, which customer. The electric 50,000 guest rooms, more will monitor and control cooperatives distribute developed campsites than distribution and transmis-power to more than any other area,40 cham-sion substations. 300,000 customers in 35 pionship golf courses, and The distribution map-counties of the state. 20 additional courses to be ping system completed the Sales to the munici-completed within five computer-based digitized palities of llamberg and years. mapping of 13 substations Georgetown increased This division provided and their feeders for in. 3.7 percent. new service to 1,633 single creased economic load family homes, 2,206 con-flow and more elTicient m dominium units,1,193 delivery of service. DISTRIBlm0N townhouse and apartment A new 4,125 square units, five mobile home foot retail o'fice, located in Santee Cooper pro-subdivisions, five hotels, Nonh Alynle Ileach, was vided distribution and re-four shopping centers, and completed. The facility in-tail services to 81,950 cus-212 other commercial cus-cludes customer services tomers in the counties of tomers. Service was also and offices for engineers llerkeley, Harry, and completed to a new sur-and energy management Georgetown, compared to face water treatment plant representatives. In the llerkeley District, underground service was provided to an apartment FUELGENERAllNG COST /KWH complex, a fast-fcxxl "" #[* restaurant, a new mini-i mall, and a small shopping \\ ar. 7 l l

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l Joe C. Norman ~ Powercompanieswillbe programs began, approxi. L among thelastindustries ENERGY mately si million has been MANAGEMENT loaned. In this countryto be p Approximately 80 6.. challenged bythe "world The Good Cents schmis and 50,000 economy."It has already Program, a national plan students and teachers in shownits impactin subtle f r enugy<mcient, an-Hony, G=getow n, and ekctric residences, was Berkeley counties were Ways.Those of usin the introduced to new home supplied with audio / visual f businesswho help our buyers. Energy Afanage. and printed energy educa-customers become more ment presented the pro-tion materials. To promote N* """*Y"*"'#""" . energy-efficient will be velopers, contractors, en-company's educational theleadersin theindustrY gineers, and architects and resources, teacher confer-in the next decade. worked with them on re-ences were held in all I' Customer sensitivity, pro, quired construction stan-three counties, dards. Construaion of Santee Cooper and ductivity, and efficiency housing units using Goal k> cal electric cooperatives must be the forces that Cents guidelines began in co-sponsored a NEED (Na-drive us, and Santee Green Park, a condomin-tional Energy Education ium pmjed, and Fomoft, Day) studenkonfuence Cooperis already moving a patio home community-that featured energy-forward with programs both located in 31ynte related activities. like the "Good Cents" Beach. Energy Alanagement j.. energy-efficient home. To promote energy-coordinated educational efficient mobile homes, seminars on cost efficiency Santce Cooper adopted a for heat pump contractors, N rigid Good Cents Alobile architects, builders, rim n rsident. Ilome Program. developers, realtors, Gunmercial OAratimes Gomi Cents low-inter-financial institutions, civic est residentialloans for groups, and company energy-efficient home employees. I *. imprtwements were Santee Cooper re- $326.467.68, including ceived the American $251,196.69 for installation Public Power Association of new electric heat (APPA) Energy innovator pumps. Twenty-six fossil Awards for an APPA-fuel and 46 electric resis-funded Dem(>nstration of tance heating systems Energy-Efficient Develop-were converted to heat ments project. The projed pumps. Since Santee ases a computer program Cooper's low-interest loan to analyze data from resi-9

dential multi-channel, For FY 87, the Summer solid-state meters for rate NUCLEAR POWER Nuclear Station generated design and marketing over 1.7 billion kilowatt-research. The Virgil C. Summer hours of electricity for San-Energy audits were Nuclear Station, an 885-tee Cooper customers, or provided for more than megawatt nuclear plant approximately 15 percent 450 residential customers jointly owned with South of the company's and 85 commercial cus-Carolina Electric & Gas electricity sales. tomers. Company, achieved a ca-Inad calculations and pacity factor of over 92 SYSTEM Pl. ANNIE thermal design analyses percent in calendar year for sizing eledric heating 1986, making it one of the As part of System and cooling systems were top nuclear perfomiers in Planning's growth, training provided for more than the t:nited States. Santee and technical instmction 480 residential customers Cooper owns one-third of manuals were written and and 68 commercial this nuclear unit. a PEP committee was or-customers. In Starch, the plant un-ganized to ensure contin derwent its third refueling ued coordination between GENERATIONAND outage. In n' 87, until this System Planning and I. DAD GROWTH scheduled outage, the Power Supply Planning. Santee Cooper facih.- plant achieved an avail-Improving system relia-ability of 98.4 percent and bility, planning activities ties, including one-third a capacity factor of 93 were completed on a new ownership of the V.C. percent. three-way interconnection Summer Nuclear Station, The 1987 refueling out-between Santee Cmper, generated 11,718,436 net j age was one of the most Savannah Electric and megawatthours of electnc-extensive yet undertaken Power Company, and sty this year, an increase of by the Summer Nuclear Georgia Power Company, 8.9 percent over last year. Station. In addition to the including a 500-230 kV Of the total power gen-actual refueling, the out-West SicIntosh Station and + crated,80.7 percent was i age allowed for many a new 230 kV power line produced using coal,14.9 modifications and from the Illuffton-liilton percent by nuclear, and extensive maintenance Ilead area to 3!cIntosh. 4.4 percent by hydroelec-work. Inspections and pre-Two major new substa-tnc. The percentage of nu-ventive measures were tions were planned for the clear power generation also taken on the unit's florry-Georgetown area-decreased because of the three steam generators to Red Illuff 230 kV Station in three-month outage for ensure a greater effective llorry County and Camp-reloading fuel. Peak lifetime. The next refuel-field 230 kV Station in hourly demand for the ing outage is scheduled Georgetown County. year matched that re-for the fall of 1988. corded last year - 2,123 1 megawatthours. 10

l t m tion fire detection system Also, a new supervisory ElGNEERifE AND modifications, permanent system was installed to en-CONSTRUCTION turbine building east wall, able control room person-O and yard equipment nel to remotely operate j At Cross Station, the building. auxiliary equipment, in-boiler supplier modified Unit No. 4 atJefferies cluding two Santee River l the boiler to meet the con-Station was modemized pumping stations, the tractual guarantee for effi-by equipping the two holding pond pumping ciency. Arbitration pro-1,500 horsepower induced station, and the cooling ceedings with the flue gas draft fan motors with vari-tower fans and equipment. desulfurization system able speed drive (VSD) The State General As-supplier ended, and a set-units to resolve a fan vi-sembly passed legislation l tlement of $4.78 million bracon problem and lower authorizing Santee Cooper l' was received. This money electric power consump-to enter the wholesale wa-l is being used to install tion. Based on the success ter supply business and l necessary equipment im-of this project and poten-sell potable water from the provements for satisfac-tial power savings, motors take system to entities in l tory performance. at other stations will be lleckeley, Charleston, f Also at Cross, several equipped with VSD's. Dorchester, Orangeburg, l improvement projects At Winyah Station, the and Clarendon counties. were completed, including boiler manufacturer in-Following the 1986 pre-electronic as-received stalled a radiant reheater liminary feasibility study, a I coalscale, coal pulveriza-section to improve boiler more detailed engineering perfomiance of Unit No. 2. study and cost estimate was completed in June for developing water rates for use in negotiations with potential wholesale cus-tomers. l I t PERFORMANCEAND ENVIRONMENTAL l SERVICES tie ach The Perfomiance Group conducted themio-dynamic tests on eight GENERATION AND co 1-fired generating units, TRANSMISSION SYSTEM turbine enthalpy tests on l adeston three units, load control I tests on two units, and vanous station compo< ent j on Head tests on equipment s.ch land r I 11

RobertV. Tanner ' as ccoling towers and - gations, and Spill Preven-lnCre8 Sed efliClency, boilers. The test results are tion Control and Counter- _ innovation, and resource ~ used to document heat measure plans. developmentare the mad rates, improve umt effi-ciency, predict unit main. Signs maMng the riew ' tenance requirements, de-EN directions forSantee OPERATIONS termine which units are C00 pert Production the most economical to During this fiscal year, Department. Improved operate, and calculate pre-the average unit availability cise costs for generating of Santee Cooper's gener. heat rates, m0re efficient electricity. ating stations was much USe Of Station power, and Environmental Services. higher than the national m0dification Of Our provided technical assis-average. Winyah Station's - tance to the generating Unit No. I led with 89.1 gerierating e@ipment WiU stations and other divi-percent availability,5.40 help USimprove perfor-sions of Santee Cooper on percent better than the na-mance and Save milll0nS regulations for hazardous tional average. Of d0llarS. Devel0pment Of and non-hazardous waste,. Winyah Stat. ion also acid rain, surface water, won the Production Op. a regl0nalWatertreatment ground water, under-erations Goals Program facilityWillhelp Ourf!Ve-ground storage tanks, annual award, with an im-COUntyarea meetitS community right-to-know, proved heat rate 3.75 per-needS forWaterWellinto air quality, and PCBs, as-cent over the previous suring compliance with year. Greater plant effi-the next Ceritury. state and federal environ-ciency saved 53,400,000 in mental regulations. fuel costs. Grainger Station To manage the activi-set ti safety record, report-g ties required by these en - ing no accidents for the f, h vironmental regulations. year. g.g, pgg, several programs were Jefferies Station's Unit Pnduction a begun, such as a PCB No.1, Santee Cooper's old-management plan, Best est steam unit, which dates Af anagement Practices from 1953, had a maior plans, Waste Oil incinera-planned steam generator tion, Solvent and Paint outage to replace the Waste Recycling, Solid and superheater tubes and Hazardous Waste Tracking keep it ready for any re-plan, Underground stor-quired operation. age Tank program, Pemiit Annual inspections Tracking system. Ground were performed on all Water Afonitoring pro-units to prepare them to gram Biomonitoring and meet the summer load re-Alacroinvertebrate investi-quirements. ' 12.

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(!,,, l, J,), u UNs'&2 }M megana"s ,..t. . ) i 2 ~ega*ans 3* ( 5 58 6 m'or $408 pe = * $ 04 m ao, p.'- U~s3&4 e Began Com.merc'ai Operatior 'e42 Bega" Cc~r erc.a: Opera *c-950 'v: -tf {a.- '.. ' 9 3 9 i \\ p* *i p 1 cnstoctcn c,ost -l q,.'I.\\ del ~~$N 1 C' 3 ,1, )' FY 1987 Generahon FY 196 ' Se^eraDo" u- 's ' & 2 5 ' 5 ' - o o^ t 498 m or *- o-r*- s ' pe,.. . r-' y;,;.-'K*'.,*' assa:ts $ 54 0 "C' O' 'S 3 $ 4 s Fuel Consumonon F Y ' 98 ' no e Fse Consump!cn FV'M'^cre g,r ! -@g, 7, p $ 3-F $ s pe n s + /- ~_ - y. ) k V' L) > >.:: ' -

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ilobert E,liainear "Qualityis Job One"is ginia Power Company-to M SUPPt.Y exch:mge current system the Ford-bonoWed " I' Commitment that best The supen isory Con-formation xchanged on describesthe direction of trol and Data Acquisition this VACAR NIT System lowered Costs and (SCADA) system, used to includes energy for sale or l Improved service sought rem tely g ther infonna-purchase, price quotes, tion from and operate sub-transactions in progress, l by Engineering and stations and generating generatmg umt status, and i l Operations. Computer-stations, was expanded to computer-recommended aided standards and include on-line load now transactions. audies t pwdia dw er-s nice Coopa entema designs, innovative and fect of planned switching into a contractual agree-Cost-Cutting CoMon operations. ment for energy sales to leChniques, improved A computerized lake Florida Power & Light maintenance pmcedures, management pmgrani cmnpany. nw nrsumnsac-was introduced to help tion took place during a and Computerized power make lake management. seven-day period in May, Contmland dispatching decisions. with a maximum hourly methodswillhelp us Weather conditions are demand of 300 MW and a "I *d di"'dY ""' "- total ennsy tonsfa of accomplish these goals. former and transmission 50,400 megawatthours for Thmugh employee partici-line capabilities and lake s962,208. paljon, We Will Continue to conditions. Therefore, as System Control pur-Identifythe areaswhere pan of the SCADA system, chased 111,143 megawatt-remote sensors that moni-hours of power from the tor wind speed, wind di-mterconnected utilities in be lowered. rection, temperature, and FY 87 to displace higher-l rainfall were installed at cost generation for a sav-various substations, ings of $343,000. Also, k gg A separate computer-229,260 megawatthours of

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~ " " ~ Vice Pn sident. erational, allowing system terconnected utilities for a Enxinwring 6 opemiivus control personnel at all total of $4,705.000. VACAR companies-San. A PEP committee was tee Cooper, Carolina organized to include Power & Light Company, Power Supply Planning. South Carolina Electric & Gas Company, Duke Power Company, and Vir-17

) m width through the use of Federal funding was DESIGN an existing right-of-way obtained to correct seismic EEINEERIE met aesthetic and environ-load deficiencies ir the Design Engineering mental requirements of West Pinopolis and Nonh { completed key projects routing the line along U.S. Santee Dams. important to system relia-Highway 17. As an alternative to re-j bihty. Design work was in addition, on April 1, building the North Santee i l completed on the a 69 kV transmission line Dam and Spillway, a Com-Bluffton-McIntosh project, tap, approximately 10 prehensive Emergency Ac-a major tie with Georgia miles long, was energized tion Plan for Dam Failure Powet Company and to serve Union Carbide's was tested in February. Savannah Electric and Kershaw County plant. State and county emer-Power Company. The The entire project was gency preparedness agen-project includes a 500-230 completed in 15 mc nths, cies participated with San-kV substation in Georgia meeting tight schedule tee Cooper, and officials and a 25-mile 230 kV requirements. from the FERC observed transmission line. Within Also, survey work was the exercise. five years, Santee Cooper completed on the Santee The emergency plan will realize a $14 million Cooper Project ik>undary included installation of a I savings in construction as required by the Federal 15-siren warning system, costs when the McIntosh Energy Regulatory extending 25 miles down-substation is sold to Geor-Commission (FERC) for stream of the Santee Dam gia Pov er Company.This relicensing. in the Santee River Fk>od project required routing a Basin. In addition, tailwater 230 kV bundled conductor monitoring devices at the transmission line through GENERAL North Santee Dam were / dense swamps, over a ma-CONSTRUCTION installed to alert residents jor river, and across state Santee Cooper's 42 and Santee Cooper's lines. Construction con-miles of dams and dikes Energy Control Center in tracts were awarded to and its 56-mile-long navi-the event of a dam failure. meet an energization date gation channel were main-Residents in the flood plain i ofJanuary 1,1988. tained by work forces in received tone alert radios Also, rou:e selection General Construction who to be activated by the Na-was completed on the removed floatage and re-tional Weather Service in Campfield-Pawleys Island paired the structures, chan-an emergency. All emer-115 kV line.1his project nel markers, and buoys, gency systems were in-also had unusual design The Federal Energy Regu-stalled in less than six features, including a gas-latory Commission (FERC) months, and the test was filled, pipe-type subma-reported that the project is judged a success. The ac-f rine cable routed under in excellent condition for ceptance of this alternative, l the intracoastal Waterway. normal static loads and is over rebuilding the North Use of long-span design well maintained. Santee Dam, will ensure and reduced right-of-way long-term savings esti-18 1

mated between $500 mil. M South Carolina Electric & lion and $1 billion. PROJECT Gas Company at Bushy General Constmetion MANAGEMENT Park, North Charlerton, St. also provided clearing, The Project $lanage-George, Stateeba, Colum-grading, site preparation, ment division of Engineer-bia, and the Summer Nu. foundation and carpentry ing and Operations pro-clear Station; with inuth-work, and maiatained roads vided project engineering, eastern Power Administra-and drainages for Santee budget ;ontrol, construc-tion, Duke Power Com-Cooper's 52 subdivisions. tion management, and ma-pany, and the Southern terial coordination for 96 Company at Clark Hill; and projects in the 10-year con-with Carolina Power & TRANSMISSION stmetion budget. These 1.ight Company at Darling-OPERATIONS projects, totaling over $240 ton, Hemingway, Kings-hlore than 11 billion million, involve new con-tree, Lugoff, and Robinson. kilowatthours of electricity struction and upgrading of were delivered to about system substations and 382,000 customers either transmission lines. CORPORATE COMMUNICATIONS directly or indirectly 51ajor projects in which through Santee Cooper's Project 51anagement Santee Cooper received transmission system. This shared responsibility were national recognition for its consists of 3,372 miles of service to the Union Car-1986 Annual Report in the line and 58 substations and bide air reduction plant in form of the Walter C. Sla-switching stations with Camder., the AlcIntosh tie son Award presented by voltages ranging from with Georgia Power Com-the American Society of 34,000 to 230,000 volts. pany and Savannah Elec-Peraonnel Administration. Power was supplied to tric and Power Company, it was presented for the about 82,000 retail cus-and the 115 kV transmis-most outstanding por-tomers, two municipalities, sion line from Campfield to trayal of human relations three military installations, Pawleys Island. values in an annual re-27 large industrial cus-port.' 'Ihe report was also tomers, and about 300,000 judged first place in an-REUABluTY customers served by 15 of nual competitions spon-the state's 20 electric coop-To improve system re-sored by the American cratives through 221 deliv-liability, ',antee Cooper Publ:c Power Association ery points. maintains interconnections and the Advertising Fed-Recent transmission sys-with other ekrtric uilities, eration of Charleston. tem additions include nine including the Southeastern Electronic communica. new cooperative delivery Power Administration and tion between employees points and eight tap lines. the Southem Company at was introduced with The 69 kV line supplying the R.It Russell Dam; with power to the new Union Carbide air reduction plant was energized April 1. 19

~ l t ] s ( ~. AndrewBurke W ' NEWSLINE, an on-line Cooper 3 service territory. Amore p 0ductwe news service which The first of these, the At* Sppf0ach10 economic de- ' provides updated informa-lantic Gateway liusiness & VelopmentWillfBSult from tion to more than 400 em- - Industry Park, located in - ployees with computer conway, was developed a new alliance of C00pera-tenninals.

jointly with llorry County tion between Santee "An Invitation to Char-and ready for announce-5aM Ml teston,' a multi image pro-ment at the end of the fis-Electric Power C00pera--

duction, was produced by cal year. An agreement - Corporate Communica-was also received from the tiVe and ItS15-member tions for tire Convention first industrial fimi com-00-ops. Our efl0rt Will be and Visitors 13ureau of the mitted to locate on part of g g gpg Charleston Trident Cham-the 272-acre site. ber of Commerce. As a Additional market re. Create jobs and && result, the Chamber pre-search and targeted adver-lating economic Of0Wlh, sented Santee Cooper with tising were established as bothin the areas Served the Golden Pineapple major features of the new by Santu. Cooper and the Award for outstanding marketing program. support of tourism. InJune, Govemor electric C00pefatives and Campbell signed into law throughout South 13ill SH>l, which limited N Santee Cooper's ability to serve new industrial cus-As part of a corporate tomers to the areas of as-change of fundions, the signed service territory in g M, - Economic Development 13erkeley, liony, and t' ice 1%Ident, Division was renamed the Georgetown Counties. ,ya,h tirws Marketing Division. In-Support of statewide creased priority was di-industrial growth was pro-rected to industrial reten-vided through participa-tion and expansion. tion in the South Carolina A new program was Coordinating Council for hrgun for the develop-Economic Development. ment and management of Efforts were expanded to a series ofindustrial parks work with and support the located within Santee electric cooperatives in 35 of the state's 46 counties. 20

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y,; y ;. g g _ 7. L. f f j g.3.. 4 3. r.w 7 w. 1 In the mosquito control m FLOOD CONTROL program, more than WATER QUAUTY Spilhng w.as requ red 103,000 acres of land and MANAGEMENT i for a total of 14 day; dur-water were treated. Cop. The 50 water quality ing Marth, with an pice cle ring and ditch monitoring stations lo-average spill of 26,639 cu, maintenance, draining, cated throughout the lake bic feet per second (cfs). nd filling were conducted system were sampled on a n m re than 400 acres to This was part of Santee regular basis. Stations i Ox>per's Dood control reduce breeding sites. Ilio-were monitored monthly program to maintain I gic 1 e ntrol with the gg,. physical, chemical, and proper elevations of the m squito Osh. Gambusia biological conditions, and lakes and to reduce fkx>d-afbris, and the bacterial 18,050 analyses were con-ing of the lower Santee SP TC $"*PC"*i " I UdC'I~ ducted during the year in River. I"# 'I'd""N"S##' *

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used in all suitable areas. M0SQUITO ABATEMENT PEAK DEMAND (MW) GdvalF litF More tl in 8,000 i i entomological inspections '77 ' )' were conducted in the '78 usi J '78 ' 452 five-county area around '80 i ss4 l the Santee Cooper lakes to '81 km l collect data for mosquito '82 ws control assessment and j '83 1.nto plannm.g. ) '84 1.n 9 ] '85 zus, '86 sus l '87 sts l CAPACITY (MW) Gd9k1F litF 0 50 0 SM tEC 20C0 2E0 3000 ,Y /.) '78 '79.. '80 1,nn I '81 ev:0 '82 E j '83 3,v '84 2.nn '85 E '86 o '87 zws 22 I f i ? Two surface water aginis, were harvested subdivisions, commercial e drainages flowing to take and supplied to the Afos-Ic ts, gratis leases to public Starion from the GSX liaz-quito Abatement Section and quasi-public agencies, I ardous Staterial Land Dis-for mosquito larvae con-and various miscellaneous posal Facility near Pine-trol throughout the Santee leases for public recrea-g wood, S. C. w ere also Qx>per system. tional facilities. Revenues L sampled as part of an on-Genetic research to collected from these leases I going study. A tracer dye pr xiuce triploid grass carp totaled 5623,316 during N study was conducted in fish for biological aquatic last year. Propeny Man-r lake Marion adjacent to plant management contin-agement personnel pro- ) the GSX site to document ued throughout the year. vided routine maintenance l water flow patterns, travel The triploid were and repairs for 17 public L times, and dilution rates of spawned using hydrostatic boat launching ramps and E contaminants which may pressure chamber shock parking areas under lease f enter lake Marion from of fertilized eggs, to the South Carolina h the GSX facility. Wildlife and Marine Re-h Aquatic plant control sources Department. HORTICULTURE Santee omper, coordi-was conducted on 3,750 g acres of noxious aquatic A tile drainage system nating with the S. C. De-vegetation. EPA-approved was instalkd underneath panment of Parks, Recrea-y herbicides were applied the greenhouse growing tion & Tourism, began 7 i-by helicopter, airboat, and beds for improved drain-work on the Old Santee truck-mount spray units, age and production. The Canal State Park. This 220-a Of the 5562.500 program greenhouse roofs were acre historic and environ-cost, $505,250 was funded covered with four-mil mental park is k>cated t f by the S. C. Aquatic Plant double poly material to near Santee Cooper's

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Management Council and replace worn and wind-headquarters, adjacent to i the U. S. Army Corps of damaged roofs. Stony landing Plantation E Engineers. Revenue from honicul-in Berkeley County. The ture for the year totaled site includes the lower y AQUACULTURE ss3M. p ni n f the Santee Ca-nal, the first major over-E- About i50,000 n/apia mg P land construction of its E fish were cultured at San-PROPERTY kind in the Um. d States. te. y MEM tee Cooper,s aquaculture The park is projected to be h hatchery at Winyah Station The Property Manage-completed and open m. in Georgetown. Most were ment Division adminis-stocked in the Winyah Sta-tered approximately 1250 A total of 18,899 acres tion cooling reservoir for leases around the 152.6s8-of prime wildlife and wa- = weed controi mainte-acre Santee Cooper lakes.

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rw......s E P F. EugeneWilliams F E W0rking more Closelywith for use as part of the implement, with annual Our elected and 90Vern-state's Wildlife 51anage-costs of $320.39 and an-I" ment Program. Reforesta-nual savings of $8,021,18. mental OffiClals at all tion programs resulted m. Tlu..s includes eight of the r levels will help us sig-815,000 genetically im. total 10 projects com-k nifiCantlylmpr0Ve the proved pine reedlings pleted for n' 87 and rep-being planted on 1,156 resents an amage par h quality and dimensions of acres of Santee Cooper back period of 23 months. P serVIC8 t0 Dur Cust0mers, lands. Approximately PEP established em-the C0mmunities where 4,100 acres of forest were ployee introductory train. control-bumed to reduce ing courses. Introduction We serve, and the pe0ple wildfire hazards, improve to Employee involvement, p Of S0uth Carolina. As a aesthetics and wildlife introduction to Problem Vital economic and energy habitat, and control unde-Solving, and Introduction [ res0urce belonging 10 the sirable species. one to Panicipative slanage-hundred fifty miles of fire-ment emphasized listening 5 people of this state, Our E breaks were constructed and communication skills, m0stimportant C0mmit-or maintained around team building, group 5 meritis10 respond more young pine plantations to problem solving, leader-b effectivelyiC their needs, protect them from wild-ship style, and effective fires. Revenues from the meeting management. sale of forest products and [ g. agriculturalleases totaled HUMAN more than s260,ooo. RESOURCES g b iVcc P nsiderit. During the year, ap-f con mmenud.q;nn PROGRAM FOR proximately 125 employ-EMPt.0YEE B PARTICIPATION ees particip ted in He Ith 51aintenance Organiza-F Nineteen groups in the 7: tions, and over 40 percent E company's Program for E of employees were en-E.mployee Participation rolled in the deferred com-(PEP), a program designed 2 pensation program. One to improve efficiency, r-b hundred seventy employ-were staned in n,8.,i, ees advanced to new re-bringing the total number sponsibilities through the of active groups company-P "N wide to 29. This represents or by natural progression. 220 employees, a Ib, per-The company hired 118 = cent increase over last fis-new employees. This five =_ cal yea r. percent growth increased Completed projects total employment to 1,559. averaged s15,014.9 to Sixty-one temporary em- E L 3 playees were used to sup-control of health hazards credits for courses taken piement the workforce in the workplace, more by Santee C(x>per employ-I~ and to limit full-time em-than 200 employees in ces. R>ur new electrical / )_ ployment. Production and Opera-electronics training 3 tions were monitored for courses were arranged, d 6 noise exposure. and several computer soft-u OCCUPATIONAL ware courses were up-y HEALTH m dated. A relay test panel, a T Annual employee TRAINNiAND training aid for relay main-physicals were expanded DEVELOPMENT tenance personnel, was to include comprehensive Employees attended developed, and a formal blood chemistry profiles 460 external courses and training program for distri- .3 b reponing bh>od choles-186 internal programs in bution linemen was imple-m [ terol and heart, liver, and various subject areas in-mented. Eight new line- ) [ kidney function. Over cluding professional skills men courses for transnus-F 1,500 employees and ap-development. sion and distribution sys-j plicants received evalu-Eighteen engineers tems were organized, and gr ations and health advice. were enrolled in an a computer training lab for l Supporting Santee external Professional Engi-personal computer train-a Cooper's new restricted neering Reviews program ing programs was estab-smoking policy, Occupa-at a hacal college to help lished. The supervisory m tional IIcalth sponsored them obtain a Professional management and the me-g smoking cessation classes r gineering license. chanical maintenance n throughout the company. There were 121 internal training programs were 'l Sixty-seven employees training programs, w hich updated, and a basic in-q 7-successfully completed the included supervisory and strumentation course for .{ course. management programs, Produc' ion Operations Occupational licalth computer, communication was developed. Thirty-also conduced 51ultime-techniques, customer eight unit operators com-L dia First Aid instrudion for service, electrical /elec-pleted simulator training. 314 employees and CPR tronic instrumentation, Two hundred employ-r g and Basic Life Support mechanical maintenance, ces completed college g courses for 1,034. Ilearing power plant operations, level and technical educa- ' ] Conservation classes were and lineman training pro-tion courses through the { completed by 872 employ-grams. These training pro-tuition aid program. ees, while 165 completed grams provided profes-Prevention of Back Inju-sional as well as technical NE { ries courses, and 580 com-skills development at all pleted Respiratory Protec-levels of company Santee Cooper experi-tion courses. opera' ions. enced a 33 percent reduc-As part of Industrial A program with the h>- tion in total injuries in liygiene's evaluatiori and cal technical college was 1986, earning a fifth-place developed to provide 3 m T M ) award from the American South Carolina Occupa-tions without a disabling Public Power Association tional Safety Council, injury in 1986, was earned (APPA) for 2,992,275 man-Grainger Generating Sta-by 82 crews and sections. hours worked with an in-tion, Darlington Area Safe Senice Awards were cident rate of.73. The Transmission, and Orange-presented to 137 employ-company competes annu-burg Area Transmission ces, Safe Driving Awards ally with other APPA received Awardsof Merit to 131 drivers of company member utilities operating from Santee Cooper vehicles, and three em-more than two million for completing 1986 with-playees joined various man-hours. Nineteen out a recordable injury. safety clubs that recognize units earned safety awards The President's safety workers who avoid injury from the National Safety Award, for crew and sec-by wearing protective de-Council, and 17 eamed tion safety while operating vices or equipment. Six safety awards from the under hazardous condi-employees were recog-nized for outstanding lead. RATE COMPARISON FY 87 ership in units operating [or 15 or more years with-MV A17f Antenital(Arcruge 04:1 0 20 40 e0 80 100 120 out a disabling inj,ury. 8cattic J it.M Memphis J 5 5. 73 CORPORATE Dallas 502.52 FORECASTING Santec Cooper 165.20 Los Angeles J 74.4 9 A new residential rate y , 7 7, meture, including a stan-dard residential rate and a c&ago Jm ui ammme discounted all-electric rate Ik)ston 191.6J for year-round residential Philadelphia J115 ui s custo ne.5, went into effect New York J 121.40 i November 1,1986. The ej new rates more accurately renect cost <>f-senice E RATES (CENTS /KWH) ompens nie uraun 6 am ibe.wmat an.nwe while producing the same i a 3 4 s e r revenues. Santee Goper o 52 Also, Santee Ox>per Residential Natiorul Astrage 74i adapted the national resi-dential G<xxi Cents pro-Santee Ox>per s 72 Commercial gram which includes an National Astrage 7.15 Industrial National Average 4 7; .? 7 y 1 Kenneth R. F0rd i incentive rate for custom-N0 rateincreaSeS during ers with all-electric, en-MANAGEMENT atleaStthe nextthree INFORMATION - ergy-efficient Good Cents ) SYSTEMS fiScalyearS.The Finance homes. A new 20-year load DepartmentWillm0Ye forecast was developed. It Technical Support t0Wald aCC0mpliShing thlS included an appliance Technical Support pro-maj0f 90al through up-saturation survey of Santee vided training, hardware Cooper's residential cus-installation, and software grading and fine-tuning tomers and an industrial support for 200 users of Santee C00 pert bud-survey to determine their Office Automation and getjng,I0 recasting, and future electrical needs. premed the same ser-finanClalplanning The forecast will be used vices,in addition to data for planning purposes,in-base management, for us. systems. Employees Will cluding the need for future ers of a new relational USe totallyintegrated generation. data base system. WorkStationStoincrease Santee Cooper won the More than 60 new per-performance and American Public Power sonal computer work-Assceiation's National En-stations were added, and effiClenCy through end-crgy Innovator Award for hardware, software, and user C0mputing. Prepara-developing a software training were provided for tionS are underway 10r package calkxl EL\\lA more than 140 users of (Electric load Data anJ mainframe-integrated per. additionaladvance re-31anagement Analysi:,) sonal computers. Techni-fundingS, and the w hich provides flexible cal Support also began introduction Of a $500 and comprehensive data publishing a monthly mini-b0nd program Will management and analysis users' newsletter. of load and end-use sur-All operating system all0W m0re Santee vey projects. software on the two main-Cooper employeBS and Santee Cooper began frame computers was up-CuSt0merS10 lHVBSt in the billing all municipal, coop-graded to improve users' erative, and large indus-access to both computers.

C0mpany, trial customers on a calen-Telecommunications hard-dar month basis. This ware and new software preress fits calendar were instalkd to improve month energy sales to remote network manage-monthly operation records ment.

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490 5 mete reading. ing Series A in the principal The two issues com. 5

Other applications co-amount of $192,660,000, bined produce an average ordinated by Systems and which resulted in a present annual savings of approxis 605 650 Programming concemed value savings of mately $4.3 million*

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$19,373,000 and a gross ' 765 825 Project correspondence, employee savings bond TOTAL.PEAX DEMAND FORECAST (MW) i 900 purchasing, and payroll Guner her l1.060 y 1,160 a .m, - s s se m .o tax reponing. 4150 Also, the payroll, pur- - J.msQ chasing, and retail billing - - see '97 4c systems were upgraded. ", -- --_ N a# w - wy Data Center '95 2451 -.1.we e 5,000* ,94 Peripheral equipment, in-3 '93 N cluding more disk storage '92 and a new controller to '91 /.Ni improve communication ( g '90 2 "' with remote locations, was '89 > >U added to the mainframe \\ f '88 2 ' computer system. liigh- '87 >1a> speed long and short range modems were added to i TOTAL ENERGY FORECASE(GWH) transmit data, agot, n,y 0 1 2 3 4 5 6 ' 4 9 10 11 if 13 M '99 12 s>s l mEASURY 981 1s2 l - am Two successful refund- '97 Ilme' '96 ~ q ing bond issues occurred '95 during the fiscal year. '8 4 '2>^ The first refunding is- '93ri ve sue - the largest Electric 15.293 ,J211 so f System Expansion Reve-nue bond sale by Santee h '91 11 n > i 4 '90 n>>ai Cooper - was the 1986 1 l l Refunding Series C and D '88 n ni e in the principal amount of g '8# M215 $335,630,000. This re-q so L I L APPUCATIONS OF REVENUE f wan I mical lune m IW amt iw 1987 1986 Totat Operating Reseques $ 480,059.055 5 455 000 175 Operating Expenses g Operation 1 Product,on 204,600,163 195 057 706 $,$Q/.r$$ j^ Purchased and hiercna,ged Po ver - Net 2,698.075 (213 379) L Tra,smiss:on 1.821,495 1 991 478 A e s : x i F)$4.g e* Distnbut;on 2,300.421 2 158 299 ,7 Customer Accounts (172,250) 1 849974 -f - ddk,,*N3 YdiI# L Saies 317,427 283.845 ~. Adm;nistratwe and Genera: 28.692,720 25 231 152 .t, 2 ,g f.L.*, ~ Maintenance 33,388.056 34 596 425 R.;; ?. 7,y'3. l-Totat Oscat>on a,0 Ma.ntenance Expenses 273,646,107 260955 500 . pr b 4. ' c.}.' B. l v 1 ~ Sums n L<eu of Taxes 2,389,663 2 176 137 Tota' Operatag Eapenses 276.035,770 263131 637 i Net Operatmg Revenues 204.02'35285 ~ ~ 191 868 538 w.- Other Mcome 24.996,744 26 687030 ..+ gq;3g: g .qn., g 1 Revenue Avadacte 'or Debt Servtce p ' -[;; - '. and Other Pu poses 229,020.029 218 555 568 y f' 4 ; 1, r Tota: Dett Servtce 154.236,930 150 910.358 Lease Pa3 ments to Cent'a' 5,465.308 5 466 375 Prmc' pal and hterest on Otner 00hgat.ons 25.038.097 23 759 265 t' ?', s p.'j' _,Nh[3M %^- Ba'ance a'ter Debt Serece Lease Paiments and Other Obogations 44.279.694 38 419 570 Payments to the State o' South Caronna 2,003,036 1 900012 Payment to the Spec.a Reserve Fu d - net 1.459.116 1 392 865 n Mandatory 8 t Ahocation for Cap'ta' imorovements 26,761,366 26 057714 Reven e Ava~aD'e for Operat.ng Requ4ements S 14.056,176 5 906893 u 1 L' D hs s mmary has been prepa'ed ' rom " e 'manc'a statements and other data of int Autherty and has not Deen exam lned tr, tne indepencert aca tors This su'"mary presents the net 'evanuee a<adab!e to the Reven e u i. Fu d 'or pu poses ssc" as presid'ng 'or ;rcreases.n vors,ng cad tal repuremen' it 5"ers from the State-n r en! a' Remve' ?c Eamngs in that ' epase"ts cast t'ansact ons on debt serv : and accord'ngt) exc!udts k 1Cn cash te*nS iven as de0'eC,atiO Foo,ce for 'unds used donng cons' utton and amortilation of debt ) discou t an1 eQev n p i 3 i ~ ~,. Md - _ ne- .1 e s ..s s 4 r ,..-a .,4,.'.

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.y.. v ' ^ v :C ; Q JW,.. :...; 7: p:;.l?,$.: . :. J ' * ' l : ' I, ".. '. ., a w w*" % 4.., ? 1 ' ',' :>.p. n. 4, ~ yy,. - { ~f}f. '; ; ~ { f.. k. ';. ' l. l:,[.f.'I.v: e y.. m.',..' lly-lt qc[.# e :. ; :. ( '. ::.;.. [ ? '. '.l \\ [ '

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'T - '.Y: b>: ' R.;, v ~;..* a v ~ {'*i:N','.:: 'h'fll ifl,l f:.f f ' i;. :..;. f-h, ; W ;.; ll y.; ;h,.s j :: h. ,.g r} ;. x ? [.f.n ::? ... Y:,-*:l ;,: a.r: 7 Y ^' , ; Y %'?.'h,El k'f,?'.hl.. f%jY ,h A;) i',[.:hl l:f. - : {*? l l W {' ~,. 7 +, F lRepoit oj' f. ~ Public Accountants. Independent Ceitified The Advisory Board and Board of Directors . South Carolina Public Service Autho'rity' Columbia, South Carolina ' We have examined the balance sheets of the South Carolina Public Service' Authority as of June 30,1987 and - k-1986, and the related statements ofc g~. reinvested earnings, accumulated earnings reinvested in the business,- and changes in financial position for . each of the three years in the. period ' ended June 30,1987. Our examina-tions were made in accordance with-- generally accepted auditing standards and, accordingly, included such tests of the accounting records and such other auditing procedures as we con-sidered necessary in the circum-stances. ji-In our opinion, the financial state. ments referred to above present fairly the financial position of the South Carolina Public Service Authority as of June 30,1987 and 1986, and the . results of its operations and changes in its financial position for each of the-three years in the period ended June 30,1987, in conformity with generally accepted accounting prin-ciples applied on a consistent basis, e - 4 Coopers & Lybrand Columbia, South Carolina August 28,1987 l J7 j s Balanco Shits' l / South Carolina Public Service Authority . June 30,1987 and 1986 - Assets 1987 1986 (Thousand!) Utility Plant - At Costi Electric plant in service $ 2,050,086 $ 2,918,545 ~ Construction work in progress 72,415 67,232 Total 2,122,501 2,075,777 1.ess accumulated depreciation 415,187 -352,252 Electric plant - net 1,707,314 1,723,525 Nuclear fuel - net 20,534 22,366 Utility plant - nel 1,727,848 1,745,891 Other Physical Property (Net of Accumulated Depreciation) ' 379 390 Cash and Investments Held by Trustee 345,823 335,364 Current Assets: Cash and Investments held by trustee 34,775 33,125 ' Accounts receivable, less allowance for doubtful accounts of $844,000 in 1987 and $3,619,000 in_1986 53,899 51,967 Accrued interest receivable 3,961 1,683 inventories, at average cost: Fuel (coal and oil) 29,762 41,100 I Materials and supplies 6,142 5,911 Prepaid expenses 2,440 2,024 Total current assets 130,979 135,810 Deferred Debits: Unamortized debt expense 18,676 22,045 Unamortized loss on refunded debt 230,137 154,666 Costs to be recovered from future revenue 197,347 168,426 Other 3,296 2,727 Total deferred debits - 449,456 347,864 Total $ 2,654,490 $ 2,565,319 The accompanying notes are an integral part of the financial statements. Si s '%h t 4 6 ~ 2 ~ f1 m. 4 g 'i [ Llibilities_ and'Capitslization - 1987 1986' (Thousands) _. Longterm Debt:. ~

e

- Priority Obligations,, $ _ L 60,515 '

$- 62,385_

Electric System Expansion Revenue Bonds '1,816,000 1,740,845 Subtotal. '1,876,605. '1,803,230 . Electric Revenue Bonds 121,500-135,000 .l*2 _- Capitalized lease obligations, 71,755 s 74,538-0 '543 P. .Other Total long term debt 2,069,860 2,013,311 . Less: ~ 2,220. 2,8801 ^ Reacquired debt 127,271. 18,387? Unamortized debt discount and premium - not ( Long term debt - net ' 2,040,369 ' 1,992,044 Accrued Interest on Longterm Debt 71,11 3 71,819 1,737, 6,632 -Construction Fund Llabilities - Accounts Payable - Other Non current Liabilities 6,303 4,410-o s j Current Liabilliies: Commercial paper 50,000 50,000 I- . Accounts payable 28,695 22,819 ' Customer deposits - 4,690 4,435 ' Accrued sums in lieu of taxes 1,146 1,076 Other 7,212 6,935 Total current liabilities 91,743 85,265 Commitments and Contingencies - . Deferred Credits: Unamortized gain on reacquired debt 406 833 Nuclear fuel settlement 16,344 16,128 Total deferred credits 16,750 16,961' Capital Contributions - U.S. Govemment Grants 34,438 34,438 ' Accumulated Esmings Reinvested in the Business 392,037 353,750 Total $ 2,654,490 $ 2,565,319 I ). ~ J9 , Stat ~m^nts cf Acaumulated Earnings Reinvested in the Business South Carolina Public Service Authority Ye:rs Ended June 30,1987,1986 and 1985 1987 1986 1985 (Thousands) Accumulated earnings reinvested in the business - beginning of year $ 353,750 $ 325,545 $ 281,297 R: Invested earnings for the year 40,200 30,106 45,948 Total 394,040 355,651 327,245 Distribution to the State of South Carolina 1 (See note below) 2,003 1,901 1,7] Accumulated earnings reinvested in the business - end of year S 392,037 $ 353,750 $ 325,545 Note: The distribution to the State of South Carolina is determined utilizing a calcula-tion formula required under the Indenture f which is based essentially on operating cash flow and mandatory reserve re-quirements. Such calculation varies substantially from reinvested earnings for the year principally due to costs to be { recovered from future revenue and work-ing capital requirements. s e Tha accompanying notes are an integral part of the financial statements. 40 Statements of RCinvcsted Earnings . South Carolina Public Service Authority Years Ended June 30,1987,1986 and 1985 1987 1986 1985 (Thousands) Operating Revenues: Sales of electricity 8 475,425 $ 451,537 $ 426,381 Other operating revenues 4,634 3,463 2,261 Total operating revenues 480,059 455,000 430,622 Operating Expenses: Operation expense: Production 204,600 195,058 203,383 Purchased and interchanged power - net 2,698 (213) (4,371) Transmission 1,8 21 1,991 1,842 Distribution 2,300 2,158 1,665 Customer accounts (172) 1,850 1,826 r Sales 318 284 162 Administrative and general 28,693 25,231 23,533, Maintenance expense 33,388 34,596 31,193 Total operation and maintenance expense 273,646 260,955 259,233 Depreciation 65,033 63,764 61,640 Sums in lieu of taxes 2,390 2,176 1,920 t Total operating expenses 341,069 326,895 322,793 Operating income 138,990 128,105 107,829 Other income: Interest income: Other funds 25,178 26,833 26,059 Borrowed funds 284 5,459 16,583 l Other income (expense) - net (181) (146) (125) Total other income 25,281 32,146 42,517 l Subtotal 164,271 160,251 150,346 Interest Charges: Interest on long term debt 144,190 150,224 159,634 Other 9,030 5,983 8,205 Total interest charges 153,220 156,207 167,839 Subtotal 11,051 4,044 (17,493) l C sts to be recovered from future revenue 28,921 27,863 67,207 l Other deductions - net (318) 1,801 3,766 Reinvested Earnings S 40,290 $ 30,106 $ 45,948 l l l Th3 accompanying notes are an integral part of the financial statements. i 41 Stat m:nts Gf Changas in , Financial. Position South Carolina Public Service Authority . Years Ended June 30,1987,1986 and 1985 1987 1986 1985 (Thousands) Funds Provided By: Operations: Reinvested earnings $ 40,290 30,106 $ 45,948 Charges (credits) to reinvested earnings not providing or requiring funds: Depreciation 65,033 63,764 61,640 Amortization of debt discount and expense 2,408 2,281-2,483 Amortization of gain or loss on reacquired debt - net 4,061 1,228 (146) Costs to be recovered from future revenue (28,921) (27,863) (67,207) Total from operations 82,871 69,516 42,718 Sale of bondsinotes 528,290 195,955 489,060 Nuclear fuel settlement 217 173 479 increase (decrease) other - net -1,984 (1,370) 21 Total funds provided 613,362 264,274 532,278 Funds Applied To: Increase in utility plant 46,978 35,857 56,256 Retirement of long term debt 468,958 177,475 493,268 increase (decrease) in cash and investments 10,465 41,779 (112,494) Decoase (Increase) In interest on long term debt 705 (6,167) 10,529 increase (decrease)in unamortized debt discount and expense 7,924 50 (1,770) Decrease in construction fund liabilities 4,895 7,606 4,051 Principal payments - capitalized lease obligations 2,784 2,716 2,645 Distribution to the State of South Carolina 2,003 1,901 1,700 ' increase in unamortized loss on refunded debt 79,959 28,237 56,460 Total funds applied 624,671 289,454 510,645 - Increase (Decrease)in Working Capital $ (11,309) $ (25,180) 21,633 increase (Decrease) Ir; Working Capital by Component: Cash and investments held by trustee 1,650 (2,563) 9,740 Accounts receivable, less allowance for doubtful accounts 1,932 11,877 9,908 i Accrued interest receivable 2,278 (1,190) 372 Inventories (11,107) (9,993) 9,050 Other current assets 416 '617 (193) Accounts payable (5,876) 5,393 (6,201) Customer deposits (255) (735) (809) Accrued sums in lieu of taxes (70) (57) (154) (25,000) Commercial paper Other current liabilities (277) (3,529) (80) Increase (Decrease)in Working Capital $ (11,309) $ (25,180) 21,633 The accompanying notes are an integral part of the financial statements. 'n' Not:s t3 Financial This results in timing differences r nized as costs Slatements to be recovered from future revenu components of cost to be recovered from future revenue follows: June 30,1987 1987 1986 1985 Note 1 - Summary of Significant Costs to be recovered Accounting Policies: from future revenue: Excess of A - System of Accounts - The accounting depreciation - records of the Authority are maintained substantially over debt service.. $ 28,921 $ 27,863 $ 41,159 in accordance with the Uniform System of Accounts Funded interest costs prescribed by tne Federal Energy Regulatory af ter in-service ' Commission (FERC). -. date. 26,048 B.- Utility Plant Capitalization and Maintenance Total $28,921. $27,863 $67,207 - - Additions to plant are recorded at cost, which ' includes' material, labor, overhead, and interest capitalized during construction. The costs of repairs tnd minor replacements are charged to appropriate operating and maintenance expense. The costs of renewals and betterments are capitalized. The original Note 3 - Cash and Investments held by Trustee: cost of utility plant retired and the cost of removal less salvage are charged to accumulated Unexpended funds from the sale of expansion depreciation. bonds, debt service funds, other special funds and C - Depreciation - Depreciation is computed on cash and securities are held and maintained by. a straight line basis over the estimated useful lives of trustees and their use restricted in accordance with the various classcs of the plant. Annual deprociation applicable provisions of various trust indentures, provisions, expressed as a percent of average bond resolutions, lease agreements, and the depreciable utlilty plant in service, was approximately Enabling Act included in the South Carolina law. 3.3% for each of the three years in the period ended Such funds consist principally of investments in June 30,1987. government securities carried at amortized cost. D - Revenue Recognition - Substantially all CASH - The carrying amount of the Authority's wholesale and industrial revenues are billed and deposits were $100,211,000 and $103,605,000 at recorded at the end of each month. Revenues from June 30,1987 and 1986, respectively. Bank balances r; tall customers are recognized on a monthly cycle were $26,181,000 and $17,449,000 at June 30,1987 basis. Fuel costs are reflected in operating expenses and 1986, respectively. Bank balances are covered by federal depository's trust department. TheInsuranc as consumed. In' the pledging bank E - Capitalization of Interest During Construction - Interest capitalized during construction is the net Authonty's deposits included $90,327,000 at June cost of borrowed funds used during construction. 30,1987 and $91,018,000 at June 30,1986 for bond F - Amortization - Unamortized debt discount, principal and interest payments due on July 1,1987 premium and expense are amorti:ed to income over and 1986, respectively,and may exceed federal the terms of the related debt issues. Unamortized depository insurance limits. gains or losses on refunded debt are amortized to INVESTMENTS - Trust indentures and resolu-Income as impacted through the rate-making process, tions authorize the Authority to invest in obligations generally over the terms of the new debt issues. c? the U.S. Treasury, agencies, and instrumen-talities, and certificates of deposit. The Authority's investments consist solely of U.S. Government securities and certificates of deposit. The market Note 2 - Costs to be Recovered from Future value of all investments exceeded the carrying value Revenue: by approximately $5,000,000 and $10,000,000 at June 30,1987 and 1986, respectively. ~The Authority has fully adopted the provisions of The Authority's investments are categorized Financial Accounting Standards Board Statement No. below to give an Indication of the level of risk 71 (SFAS No. 71), which prescribes the accounting assumed by the entity at year-end. Category 1 principles to be followed by entities subject to certain includes only U. S. Government securities which are types of regulation. The most significant impact on registered and held by trust agents in their name. the Authority was to recognize timing differences Category 2 includes Insured certificates of deposit between costs as defined in the rate-making process which are held by trust agents in the Authority's and costs determined in accordance with generally

name, accepted accounting principles. The Authority's rates are established based upon debt service and operating fund requirements. Depreciation is not considered in the cost of service calculation.

t 4I \\ -~ 1987-1986 INVESTMENTS INVESTMENTS CATEGORY CATEGORY CATEGORY CATEGORY ~ + 1-2 CASH 2 TOTAL 1 2 CASH TOTAL Unexpended Funds. (Thousands) 19828 Bonds (Cross '84) $ 18,720 $ (167). $ 18,563 General Irnprove- - rnent Funds 74,682 700 689 76,071 45,021 19 45,040 - Debt Service and Special indentured Bonds - Interest Fund i,191 1,191 1,232 1,232 Sond Fund 1,957 1,957 1,877 1,877 Debt Service 8,806 1 8,807 8,814 ' 3 8,817 Expansion Bonds . interest Fund 14,545 14,545 12,200 12,200 Bond Fund 65,078 65,078 e5,331 65,331 Debt Service 136,025 47 136,072 135,634 5,778 141,412 Subordinated Bonds Interest Fund 13,500 13,500 13,500 13,500 Bond Fund 4,624 4,624 5,029 5,029 Debt Service 2,023 2,975 47 5,045 5,027 5 5,032 Other Special Funds 23,555 (4,617) 18,938 20,267 (2,986) 17,281 Total $245,091 $3,675 3 97,062 $345,828 $233,483 30 $101,881 m v4 Revenue Fund 8 25,522 $ 3,148 8 28,670 $ 28,771 $.1,717 8 28,488 Spec;al Reserve Fund 6,104 1 6,105 4,630 7 4,637 Total $ 31,626 8 0 $ 3,149 $ 34,775 - $ 31,401 30 $ 1,724 8 33,125 the estimated decommissioning costs over the remaln- . Note 4 - Summer Nucieer Station: Ing life of the facility, These costs are being recovered through the Authority's rates. The estimated deccm The Authority and South Carolina Electric and Gas missioning costs are periodically reviewed and (SCE&G) are parties to a joint ownership agreement adjustments recorded as appropriate. providing that the Authority and SCE&G shall own the The supplier under the original uranium supply Summer Nuclear Station with undivided interest of contract treached the contract In 1975 due to uranium 33%% and 06%%, respectively. SCE&G is solely market conditions. SCE&G initiated action seeking responsible for the operation, maintenance, and specific performance of the contract provisions, and a y decommissioning of the Summer Nuclear Station, and final settlement was reachod and approved by all the Authority is obligated to pay its ownership share parties in April 1980. By terms of the order approving of all costs relating thereto. At June 30,1967 and the settlement, the court imposed confidentiality upon 1986, the plant accounts included approximately the details of the settlement. The Authority has $426,070,000 and $425,900,000, respectively, represent-received approximately $10,243,000 in cash as partial ing the Authority's investment, including capitalized settlement of the lawsuit. Additionally, the agreement Interest, in the Summer Nuclear Station. provides for delivery of some uranium, longterm Nuclear fuel costs are being amortized based on deliveries of equipment and services (including conver-energy expended which includes a component for sion and fuel fabrication) at a discount. estimated disposal costs of spent nuclear fuel. These Amounts received due to the breach of contract amortizations are included in fuel expense and are have been included in deferred credits and will be recovered through the Authority's rates. Decommis-applied as a reduction of uranium fuel costs. This is sioning costs (costs to take the plant out of service in consistent with SCE&G's treatment pursuant to an the future) for the Summer Nuclear Station are order from the South Carolina Public Service Commis-l estimated to be $314 million, for the Authority's % sion. The cost of nuclear fuel purchased has been ownership, based on a 30 year useful life with reduced by approximately $4,000,000, decommissioning expected to commence in the year 2013. The Authority accrues for its share of 44 I I Note 5 -_ Longterm Debt Outstanding: June O 1987 1988 l (Thousands) l . Priority Obligations: Sectric Revenue Bonds, Series of 1950, bearing interest at 2.70% and due 1987 to 1993 9,005 9,295 Sectric Revenue Bonds, Series of 1967, bearing interest at 410% and due 1987 and 2006 48,475 49,135 8ectric Revenue Bonds, Refunding Series of 1973, bearing interest at 5% and due 1987 to 1989 3,035 3,955 Total Priority Obligations 60,515 62,385 Sectric System Expansion Revenue Bonds: 1973 Series, bearing interest from 5.20% to 5.75% and due 1987 to 1993 and 2013 93,185 94,315 1974 Series, bearing interest from 8 6% to 6.75% and due 1987 to 1999 and 2014 102,845 104,015 1977 Refunding Series, bearing interest from 4.90% to 6% and due 1987 to 1997 and 2002 and 2016 193,2b5 196,230 1977 Series, bearing interest from 4.50% to 5.75% and due 1987 to 2002 and 2017 112,820 113,290 1978 Series, bearing interest from 4.80% to 5.875% and due 1987 to 1998 and 2008 and 2018 196,040 197,055 1979 Series A, bearing interest from 5.55% to 6.875% and due 1987 to 2003 and 2009 and 2019 106,255 107,280

1980 Series A, bearing interest from 8.90%

to 9M% and due 1987 to 1995 and 2002 29,660 30,450

1981 Series A, bearing interest from 7.80%

to 9.75% and due 1987 to 1997 and 2002 31,830 32,445

1981 Series C, bearing interest from 10.75%

to 11.75% and due 1987 to 1991 4,870 5,580

1982 Series A, bearing interest from 10%

to 11.75% and due 1987 to 1991 8,805 10,180

1982 Series B, bearing interest from 10%

to 11.25% and due 1987 to 1992 5,425 5,990

1982 Refunding Series, bearing interest from 7.25% to 9.375%

and due 1987 to 1994 and 2002 13,725 294,000

1985 Refunding Series, bearing interest from a

6.25% to 9.375% and due 1987 to 2000 and 2005 15,295 176,215 1985A Refunding Series, bearing interest from 5.75% to 9.20% and due 1987 to 1999 and 2003 and 2021 177,845 177,845 1986 A&B Refunding Series, bearing interest from 6.75% to 8.10% and due 1991 to 2008 and 2019 and 2020 195,955 195,955 1986 C&D Refunding Series, bearing interest from 4.50% to 7.30% and due 1988 to 2007 and 2012 and 2021 and 2022 335,630 1987 A Refunding Series, bearing interest from 3.25% to 7% and due 1987 to 2007 and 2012 and 2021 and 2022 192,680 Total 8ectric System Exparision Revenue Bonds 1,816,090 1,740,845 l Sectric Revenue Bonds,1985 Series, bearing interest from 6.25% to 8.70% and due 1987 to 1995 121,500 135,000 Capitalized Subordinated Lease Contracts, payable 1987 to 2015 71,755 74,538 543 Oiher Total Longterm Debt $2,089,960 $2,013,311

See schedule below for refunded debt.

45 The AJthority refunds and defeases debt primarily approximately 10.5% The net proceeds @f the bonds, as a means of reducing debt service, thereby post- $189 million (after $2.9 million payment of $4.1 million poning or reducing future electric rate adjustments. In in underwriting fees and original issue discount) plus fiscal year 1987, the Authority issued $528 million in an additional $2.9 million were used to purchase U.S. Electric System Expansion Bonds to advance refund Govemment securities. The securities have been certain maturities of the 1982 and 1985 Refunding placed in an irrevocable trust to provide for all future Series Bonds (the original bonds) aggregating $441 debt service payments on the criginal bonds. As a million. The new bonds bear an average interest rate result, the onginal bonds are considered defeased and of approximately 6.9% The original bonds averaged the liability for those bonds has been removed from approximately 9.6% The net proceeds of the bonds, the Authority's accounts. $509 million (after payment of $5.8 million and $10.2 Although the advance refunding resulted in an million in underwriting fees and original issue accounting loss of approximately $81 million and discount) plus an additional $3.8 million nre used to $28 million in 1987 and 1986, respectively, the purchase U.S. Govemment securities. In fiscal year Authority was able to reduce its total debt service 1986, the Authority issued $196 million in Electric over the next 36 years by approximately $164 million System Expansion Bonds to advance refund certain in 1987 and $28 million in 1986 and to obtain an maturities of the 1980,1981, and 1982 (the original economic gain (the difference between the present bonds) aggregating $167 million. The new bonds bear values of the debt service payments on the old and an average interest rate of approximately 7.9% The the new debt) of approximately $56 million in 1987 original bonds averaged and $14 million in 1986. Amounts outstanding, original loss on refunding, and the unamortized loss at June 30,1987 follows: Refunded Refunding Refunded Amount Original Unamortized issue Bonds Outstanding Loss Loss (Thousands) 1977 Refunding 1971 and 1976 Series S 0 $ 11,244 7,423 $139,000 of the 1981 Series B 1985A Refunding and $ 40,000 of the 1982 Series C 179,000 27,853 24,680 Cash Defeasance $ 20,000 of the 1982 Series A 20,000 2,763 2,579 1986 A&B Refunding $ 42,725 of the 1980 Series A $ 42,000 of the 1981 Series A $ 61,000 of the 1981 Series B $ 4,420 of the 1981 Series C $ 7,820 of the 1982 Series A $ 9,010 of the 1982 Series B 166,975 28,812 29,402 1986 C&D Refunding 1982 Refunding Series ($100,000 of the 1981 Series C and $127,000 of the 1982 Series A) 507,365 110,372 109,524 1987A Refunding 1985 Refunding Series ($150,000 of the 1982 Series B) 310,510 60,029 56,529 Total $ 1,183,850 $ 241,073 $ 230,137 s

============= =- = = = = = = = = = = = = = = = = = = =

The Authority's bond indentures provide for certain additional parity expansion bonds if, among other restrictions, the most significant of which are: things, the Authority's Consulting Engineer certifies The Authority covenants to establish rates and that not revenues (as defined) in each succeeding charges adequate to provide revenues sufficient, fiscal year after the date on which such additional among other things, to pay debt service when due on bonds are sold to and including the later of (a) the the pnoiity obligations and expansion bonds, to make third succeeding full fiscal year after such date or (b) required payments when due into the lease fund and the first full fiscal year after the estimated date of the capital impmvement fund, and to pay the costs of commercial operation of any power plant to pay the operation and maintenance of the Authority's electric cost of construction of which additional expansion system and all necessary repairs, replacements, and bonds have been, are being, or are then authorized to renewals thereof. be issued, shall be at least equal to the sum of the The Authority is presently required to pay annually amounts required in such fiscal year for (i) debt into its capital improvement fund an amount which, se'vice on the priority obligations and the expansion together with the amounts deposited therein in the bonds then outstanding, being issued, or authorized two preceding fiscal years, is at least equal to 8% of but not yet issued, (ii) payments into the lease fund, the Authority's gross revenues (as defined) in the three and (iii) payments into the capital improvement fund. preceding fiscal years. The Authority may issue n

Maturities of electric revenue bonds, priority obli-Pee Deo generating station subject to obtaining financ-gations and expansion bonds during the years ending Ing guaranteed by REA. June 30,1988 through 1992, are as follows: Future minimum lease payments on Central leases, at June 30,1987, were: Doctric Priority Rew ue Ot$gations & Years ending June 30-Amount Donds Expansson Bonds Total (Thousands) M 1988 $ 5,402 June 30,1988 $ 13,500 $ 16,495 $ 29,995 1989 5,345 Jtrie 30,1989 13,5CD 18,3 2 31,8s5 1990 5,258 June 30,100 1320 19,545 33,045 June 30,1W1 13,500 20,8 % 34,3m Thereafter 80,430 June m.Im2 1320 24.1 2 37,655 Total minimum lease payments 106,957 Total $ 67,500 $ 99,410 $ 166,910 Less, amounts representing interest 35,202

= = = = = - - - = - _ - = = = = = = = = = = = = = = = = = =

8 Balance at June 30,1987 $ 71,755 Note 6 - Commercial Papec Note 8 - Commitments and Contingencies: The Board of Directors authorized the issuance of commercial paper not to exceed $50,000,000. The Based on a May 1985 load forecast, the Board paper will be issued for valid corporate purposes with deferred indefin:tely the construction of the second a term not to exceed 270 days at an annual interest unit at the Cross Generating Station. In conjunction rate not to exceed 9.5%. As of June 30,1987 and with this deferral, $3,766,000 of contract cancellation 1986, the effective Interest rate on outstanding borrow-charges were incurred and charged to reinvested ings was 4.47% and 4.17%, respectively. During 1987 eamings for 1985. and 1986 the average effective interest rate was 4.18% During 1382, FERC notified the Authority that the and 4.72%, the average amount outstanding was Pinopolis West Dam and the North Santee Dam, $50,000,000 and $43,829,000 and the average maturity which form a part of the Authority's electric utility was 44 and 43 days, respectively. system, possessed marginal seismic stability under At June 30,1987, the Authority had a Revolving applicable design earthquake criteria. FERC indicated Credit Agreement with various lenders of $50,000,000, that remedial measures should be undertaken by the This Agreement is used to support the Authority's Authority to provide an increased level of seismic issuance of commercial paper. Under the Agreement stability. The Authority engaged an engineering firm to the Authority is required to pay a fee equal to 1/8 of perform studies and planning to determine the extent 1% on the total line of credit, plus 1/8 of 1% on the and cost of work necessary to correct the design average principal amount of the paper outstanding. weakr. asses. The initial engineering study has been No loans were outstanding under the Agrmment at completed and submitted to FERC for its review. June 30,1987. Until FERC has completed its review on the proposed modifications to the Pinopolis West Dam and the proposed remedial measures to be undertaken Note 7 - Contracts with Central by the Authority on the North Santee Dam, it is not Electric Power Cooperative, Inc.: possible to estimate the extent of work necessary to correct the design weaknesses. Based on the facts as The Authority has lease contracts w.th Central they currently exist, management believes that any i Electric Power Cooperative, Inc., covenng a steam cost incurred by the Authority related to the dams electric generating plant, transm,ssion facilities, and would not materially affect the financial position of i vanous other facilities. The lease terms range from the Authority' eight to twenty-eight years. Quarterly lease payments are based on a sum equal to the interest on and principal of Central's indebtedness to the Rural Electri-Note 9 - Retirement Plan: d fication Administration for funds borrowed to construct the above mentioned facilities. The Authority has an Substantially all Authority full-time employees partici-option to purchase the leased propertics at any time pate in the South Carolina Retirement System during the period of the lease agreement for a sum ("System"), a multipleomployer public employee retire-equal to Central's indebtedness remaining outstanding ment system. The payroll for employees covered by on the property involved at the time the option is the system for the years ended June 30,1987,1986 exercised or to retum the properties at the termination and 1985 was $42,A84,000, $38,898,000 and $35,675,000, of the lease. The Authority plans to exercise each and respectively, every option to acquire ownership of such facilities Employees who retire at or after age 65 or have 30 prior to expiration of the leases. Power supply and years of service are entitled to a retirement benefit, transmission services are provided to Central in payable monthly for life equal to 1.25 percent of the accordance with the Power System Coordination and first $4,800 of their final average salary and 1.65 Integration Agreement dated January 19,1981. This percent of the final average amount in excess of agreement also provides that each party will have an $4,800. Final average salary is the employee's average option to share ownership of future generating salary over the twelve highest consecutive quarters. facilities to be constructed by the other. Central has Benefits fully vest on reaching 5 years of service. advised the Authority that it will exercise its option to Vested employees may retire at or after 60 and own 45% of the second unit at Cross and the receive reduced retirement c

a ~ - benefits. The System also provides death and disabil-

l_ty benefits / Benefits are established by State statute.

Employees are required by State statute to

contribute 4 percent of the first $4,800 salary and 6 percent of salary greater than $4,800. The Authority

.O required by the same statute to contribute 7 per-cent of total oil. The contribution requirement for the June 30,1987,1986, and 1986 was $3, 000, $2,837,000 and $2,002,000 from the Authority and $2,386,000, $2,178,000 and $1,903,000 from employees. An actuarial valuation la performed for the System . annually. At the most recent valuation date, June 30, 1986, the present value of prospective benefits payable for retired and active members was approximately $8.1 billion and exceeded the amortized cost of assets of the System by approximately $3.9 billion. The present value of prospective benefits yable is a measure of the present value of pension fits, adjusted for the effects of projected salary increases, estimated to be payable in the future as a result of employee service to date. The measure, which is an actuarial present - value of credited benefits, is intended to help users assess the System funding status on a goingconcem basis, assess progress made in accumulating suffi-cient assets to pay benefits when due, and make comparisons among public employee retirement ' systems. The System does not make separate - measurements of assets and benefits payable for individual employers. The Authorities 1987 contribution represented approximately two percent of the total con'ribution to the System. Note 10 - Major Customers: Sales to the Authority's two major customers for the years ended June 30, were: 1987 1986 1985 (Thousands) Central Electric Power Cooperative, Inc. $ 207,000 $ 193,000 $ 173,000 Alumax of South Carolina, Inc. 8 80,000 $ 68,000 $ 86,000 4 4 1 48 T

i l Advisoly Board l I i. e l l -,a o i l Carroll A. CampbellJr. ) Governor ' 'i .g i s ?, ~ l I s l s a l lohn T. Campbell T. Travis hikick i ' Secretary of State Attomey General j i FOR ADDm0NAL j i

1 l'

INFORMATION j f CONTACT: 1 ~ %/ ~ c Jerg L. StalTord I)irector, Corporate ] 9 k Communications j 'I One Riverwo<xt I) rive j .\\loncks Corner I South Carolina g 29161-0398 ~ (803)?61--1051 l Grady L PattersonJr. I arle 1:. Morris Ir. i State Trea,urer Comptroller Gener.il j

r _h- [ i= P$ 1 [ Management = m M William C. hiescher 11i11 AlcCallJr. 1 CHAlEESIN President and Chief Group Alanager E THE BOARD Executive Omcer Pnxluction Operations t There were three W. Andrew Ilurke Robert F. Petracca 5 Vice Pre.,ident Group Alanager b changes in Santee Cooper's Alarketing Property & Transponation y Joard of Directors during E the past f. scal year. W.E. Kenneth R. Ford Joseph P. Thomas E (Ilill) DeInach was Vice President Group Alanager Fin nee Pl nning and Energy appointed to fill the Control unexpired term ofJ.I. Joe C. Norman = y i Washington 111. lie Vice President Ronald 11. liolmes 4.p. q.p fp represents the Second Con. Commercial Operations Alanager

;.j.A; 3f Iluman Resources e'- V F \\ r.;

~ gressional District, consist-Robert E. Rainear h5 .;~' -p ,.h O 3 {Q E ing of lxxington, Richland. Vice President Patrick D. Quinn ~ j,;w.Q. Bamberg, Orangeburg and Engineering & Operations Alanager g p.'.{;t. Design Engineering C Calhoun counties. Robert V. Tanner g DeLoach was an executive Vice President Ilyron C. Rodgers Jr. Qt'. lg{f, .y _y assistant to fonner Gover-Prmludion Alanager ..pt l(.. y T(T E nor Richard Riley and is Engineering and - 4]p'$. k'.4 I. Eugene Willi ms Construction Alanagement b president / owner of l'h \\,sce President = F.dyf Deinwe Corporation. Governmental AITairs Jerry L Stafford Albert Clinton GossettJr. Director t'.O.N k 5-E Cunis L Williamson Corporate }7 ~ b was appointed to represent h the Fourth Congressional h.c.d/'M.N "I Ilorry-Georgetown DS.'jQ,7c.i. 1 .tp. - District, composed of Division $[:;if$Y Spartanburg. Greenville, %ip/Gi and Union Counties. Ile Charles 11. AlcGlothlin Jr. General Counsel D.MY q - g replaces J. Thomas Grier. m.c_ Gossett is owner and John E.11ishop h p operator of Gossett Controller EM" f-Concrete Pipe Company in

11. Roderick Alurchison F

Greenville. JohnnieJoseph Treasurer E Young of Georgetown was appointed by Governor Emily llrown " P"'" ' "' *'"'Y Carroll Campbell to represent Georgetown .\\lben lloyt Jr. County, replacing Alarvin Group Atanager _t.. g Thomas. Young is presi. Transmission Operations l 15 dent and one of the .0* k founders of Inw Country -[ }{h Forest Pnxlucts. Inc. t #Me m n

\\ I Board o ' Directors T ,.k - f $. q.. / l g.?q _ ) '6 ~ jl ._ y ; , g,3,#[) f ' ' h, ., j,.-Q '., ..'f p.1 . + ~. ;.9.. .p, ^ [, 1 Dwight A. IIolder Walter T. Cox Ila old St. Robertson Robett D. Iknnett Pickens and Ihttor llead Clemson Walterboro Columbia Chairman 1st Vice Chairman 2nd Vice Chairman Former Electric Representing 3ril Representing ist Cooperative Executive Congressional District Congressional Distrid {t - '; F.. _- k ,}.. ~. ; Efh( {b. %.H .h -. [ '9< (f^di w ~ f, y ?jn - q t.ye .?-!,. .j.4, ' %.*w,, ' b s. .gi c.;;.

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-W >.af; f[ f.f,7.:; ' h. g ?.2 (s 5 b, l .ik(;;.[. M h,..t??,.yfhI .i j)fkhhh, kl.h{$kj W.E. Del.oach Albert C. Gossett George W. Jones Jr. John E. Stiles Columbia Greenville inris Sumter Representing 2nd Representing 4th Representing iforry County Representing 5th Congressional District Congressional Distria Congressional Distrid ~ - - ; ;. ~, _ 'l y ~ A_ W#' ) [.._ E, f 'y y. ~ 4 ~ n a Eugene F. Oliver lienry 11. Rickenbaker Starvin St. Thomas Sfont ks Comer Summerton Georgetown Representing iterkeley County Representing 6th Representing Georgetow n Congressional District County I ~L

P ap 1 u I 4 Public Power Owned by o the People ofSouth Carolina t f 3 l i Santee Cooper One Riverwtxxl Drive Aloncks Corner. South Carolina 29461-0398 i

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~~N Letter to Stockholders 4 ids. Profile 6 ' W N. I..', l}~~
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~~Q p: -s q.. ;, South Carolina Elec*.ric & Gas Company 8 f, M.'.f. : ;._' I.. ^ k it 7. Q.,.l... ;~~
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F I N A N C I A l? e O P E R A YIN G If l G H L I G H T S 7 .3* % Increase 1987 1986 (Decreasd (Milliomof Dollars except statistics and per share amounts) Financial TotalOperating Revenues 5 1,116.0 $ 1,102.0 1.3 TotalOperating Expenses $ 911.6 $ 903.3 0.9 Earnings Available for Common Stock $ 128.9 $ 122.2 5.6 Earnings PerShareof Common Stock 3.20 3.03 5.6 Dividends Declared Per Share of Common Stock 2.32 2.24 3.6 Book Value Per Share of Common Stock (Year-End) $ 21.63 $ 20.77 4.1 Market Price Per Share of Common Stock (Year-End) $ 28.50 $ 36.625 (22.2) Common Stockholders' Equity (Year-End) $ 871.6 $ 836.9 4.1 Common Stock Outstanding (Thousands; Year-End) 40,296 40,296 Constmetion Expenditures 5 173.3 $ 144.2 20.2 l Gross Utility Plant $ 3,099.9 $ 2,959.5 4.7 f Electric Operations Electric Operating Revenues $ 806.8 $ 809.5 (0.3) i Sales (Million KWH) 14,314 13,704 4.5 + l Customers (Year-End) 417,778 406,511 2.8 ( Generating Capability-Net MW (Year-End) 3,890 3,890 l Territorial Peak Demand-Net MW 2,943 2,853 3.2 Gas Operations Gas Operating Rewnues $ 306.0 $ 289.4 5.7 Sales (ThousandTherms) 734,145 671,881 9.3 l Customers (Year-End) 195,338 192,941 1.2 i Transit Operations j Transit Operating Revenues 3.2 3.1 3.2 Revenue Passengers Carried (Thousands) 8,668 8,699 (.4) r WAPITACBTRUCNRif?"~7',m" [ [gARNINC$~ANDbNIDEND$TS TI&TUIMDNtDMMONEDUlWE~,
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^ LETTER TO STOCKHOLDERS FellowStockholders: We are pleased to pres-from our own generation, Cost containment and cost ent this annual report which and all our plants functioned reduction is the focus of a sec-outlines the successes of well during this period of ond major strategy, which has SCANA Corporation during heavy demand. Over the past had the most direct effect on the past year. It is very gratify-few years, SCE&G has made current electric rates. Aggres-ing to note that most of the significant expenditures to sive renegotiation of coal sup-significant achievements dur-extend the usefullife of our ply contracts and purchase of ing 1987 resulted from our existing fossil and hydro spot market coal, decreases in employees' diligent imple-power plants. Although this corporate tax rates, redemp-mentation oflong range strat-program is not complete, it is tions of high cost bonds and egies over the past few years. already paying dividends in preferred stock together with Earnings per common improved reliability during efforts by all employees to re-share were $3.20, an increase high load conditions. duce the growth rate of non-of 5.6% over the $3.03 earned The V.C. Summer Nu-fuel operating and mainte-in 1986. Earnings for both clear Station continued its nance expenses have resulted years reflect record electric history of superior operations, in significant rate reductions. customer usage as a result of receiving very high marks in Finally, a strategy addressing record heat waves. We esti-its various inspections and operational excellence fosters mate the abnormal summer reviews, and getting full ac-superior performance as typi-weather contributed approxi-creditation of its training pro-fied by the record of V.C. Sum-mately 21e per share in 1987 grams from the Institute of mer Nuclear Station. These and appronmately 23e per Nuclear Power Operations. strategies have been success-I share in 1986. The plant was taken out of fulin making SCE&G's rates On February 24,1988, service for a scheduled refuel-among the lowest in the the Board of Directors author-ing in March 1987. The next southeast for investor-owned ized an increase in the indi-scheduled outage for refueling utilities. Since March 1984, i l cated annual dividend from is in the fall of 1988. Since the SCE&G's residential retail l $2.32 to $2.40 per common plant began commercial oper-electric rates have declined j l share. The new dividend rate ation in 1984, it has achieved from $76.91 per 1,000 kilowatt l will be reflected in the quarterly a capacity factor of 70%, as hours (kwh) to $67.72 per j dividends to be paid April 1, compared to an industry aver-1,000 kwh, a decrease of 1988 to holders of record age capacity factor of 61%. 11.9%. We believe that March 10,1988. For the past few years, SCE&G's customer base will South Carolina Electric SCE&G has aggressively pur-continue to grow approxi- & Gas Company, our princi-sued several strategies to im-mately 3% annually over the pal subsidiary, met several sig-prove its competitive position. next few years, and that the nificant challenges during One major strategy imple-combination of our marketing the past year. The abnormally ments a renewed marketing emphasis and hard-won com-hot summer established sev-program. Its major features in-petitive position will permit us eral records for peak demand clude new choices in rates, to maximize the aotential on our system, with the new information about price-value from such growt 1. record set on August 10,1987, relationships of our products, South Carolina Pipe-when the peak was 2,943 meg-primarily provided t brough line Corporation completed awatts, an increase of 3.2% our Energy Info Centers, and another successful year. Total over the prior year's peak set significant improvements in system throughput increased July 9. These peaks were met our levels of customer service. l 9.4%, to 78.8 million deka-7
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~~taining good margins on its %; 3, !.,,. [. I ; 7.,. ~ J-7 P3 M M @;; y A f, y p.y :Q.. i;wh.,p!!M , A G... sales to industrial customers 5 ' E W. 4 f~~
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.N despite general weakness in M
I . %,... w.Mggg y n.1~44. s} ,M A.w... Di ' N,k o the price of competitive en-n1 n s W {i;l. W" *. y ; #p gfg @*yy. p.;q %p, p g,y i ergy supph.es. Unfortunately, . y g @.k. 7y 'j Ici the outlook for natural gas ..O ', ',, s~. 3 V ' * ~ ' "' i* ">", r,.<,3 ,,:6 3
~~q sales durinb> the next few years is uncertain. Arter sev-~~
~~, p g g,.. y < ' _' ' y g, f g,pgggg'y e a m era 1 years of dimmished explo-t jgg j, ration activity and partial de-sgfggfg p h, j;7 gg 4sq %p p g g~ i s A yy 9 33~~
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l regulation, the mdustry is struggling to cope with over-pm < e ' *;4* T<: f r M:f, hanging costs of past contrac-tual relationships in a signifi-Because SCANA had no sub-itive, while we market our cantly different, very stantive expenence with such products and services to an competitive marketplace. a pre our first invest-expanding customer base. We been purposely will expand our diversifica-Seuth Carolina Pipeline Cor-me sn Mal investment in tion activities to augment our poration has skillfully taken advantage of opportunities these sentures was less than utility earnings. created by these changes. We $55 million at December 31, The results of opera-believe it will continue to be 1987. We are continuing to tiens for the past two years successful as the industrv expand this part of the busi-have been excc lent. Cer-adapts to a deregulated ness, but it will be a few more tainly, weathei patterns and a environment. years before net income from strong local and national While we are striving to diversification makes a sub-economy have been major fac-improve the operating results stantial contribution to con-tors in our achievements. in our principal subsidiaries, solidated net income. F lowever, the determined ef-l we recognize that they are We believe the future forts of all of our employees to regulated and there is a limit prospects for SC AN A are ex-provide excellent customer to the growth in earnings cellent. As you will see in the service, to control our costs of which can occur based on succeeding pages of this re-operation and to expand the their operations. Your man-port, the economic progress of Company's business oppor-agement decided several years our service area is moving tunities really are the founda-ago to begin a selective diver-rapidiv toward higher skill em-tions of our recent successes. sification program with the ployment and further indus-objective of having this pro-trial development. SC AN A -Am% gram provide additional earn-intends to capitalize on this ings growth while, to the ex-growth in several ways. Our p 7 tent possible, helping develop utility subsidiaries will con-x <A a-V the economy within our utili-tinue to follow those 3trategies ties' franchised service area. which keep our prices compet-Febma rv 21 IM
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It is a proud state k>cated
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~~NfS&Mf6(AA2d" mM cV @,tiQl' the United States with a population (, ?;~' ';'..I ~ e d.J J. ' - = M.i4.. 'dthle/0d9y#w)a/?my W C of appnnimatelv 3.5 million. The Y OM.QN. ' ' W.aig ~ @~~
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= @m; m gjg;1j (g MLOO young people will reach the .uue age ot 18 every vear through the end q-t Sands 0l/0(#iStS/hdI(/00(#'5 / of this decade.. Between 1970 E and 1986 the population increased sm; q. - 1 o hy/D0(##alf7/Nh;aWayS,b6ad7/ed by 31.9'i, making South Carolina Mh nC 14 j 7 wm 9..nx~ the second fastest growing state in J S 00 I&; the Southeast. . Rou hly E of f6, -. &w, <' the people live m an ur un area. Reading, Writing AndArithmetic More than half of the people work rhe importance of having a If '(ygggp6Saleh9@?lf)p/9a(l.U m retail jobs.. South Carolina better educated workforce cannot be D u,t m.g a vs ranked 14th in the nation in the understated. A fundamentally 06fSine00@flg'89dS0lled1/10/4 creation of new jobs in the latest htc. sound and successfuleducational 7 wu, 2. "^ W magazine ratin . State and kw system is essentialif South Carolina l h [i cal taxes are am'gs. ong the lowest in the is to capitalize on economic oppor-Gggg, gg[g'[ nation. The work stoppage rate tunities in the years ahead. ...,wao.;.m F: has been the lowest in the countrv The high school graduation hy6l,4 q.rITXAflO[gje$fg/ghgNM J for most of the past quarter century rate is twice what it was 10 years ago. ~ r p1 m.
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. Construction costs are among The number of college graduates is [ p nOfDCa0dhb/Tlafip0l6fMl/le-[ < the lowest in the nation.. More also up considerably. State-sup-ggg GH y than 150 of the Fortune 500 compa-ported technical schools are turning F _.m s m p g,y nies have offices or plants in the out and placing skilled workersin sta te. More than half of the peo-record numbers, and the state of g %fAfSCAQ(gpgrgggr;[! pie age 2, and over hold high school South Carohna is committing more
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~~MOU/906//S/Dheh.S0gg; Carp. degrees.. Thirteen percent of the money and resources to improve its i + h W. 9 s~~
~~people over c.ge 25 hold college b,ublic school system than ever~~
~~[ na/TIMfTX2eeWy { degrees. fore.~~
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ie i~ ( ,m w, cuSt0memand,newantd>e, ' ~ a n o AiI l 5 ' ' ~.A.. " ' s~.,*;Gq. WeMF u. ';x s s , lStaleSbvSine696SandinduS,I j r C '.? ! ' $~ ^ ~ ~ NM e g,0wae,emz s ~ y 4 ._y ~ } [ * '" y .' -,'o 2l(- 1 < n l p. 7 ,j' .W- - '( 5 ~~ \\_ -s:' e 4 e s
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the y le,momandbetterjobswill -u o 4p ; ' MK ' to upgrade the educationallevels of y M. be net ed. South Camlina has fared < M ? ks? l. WA' ~ wellin years past attracting newin-Ci M a W dustryand 1%7was no different. RQ Q' Onceagain, SCE&G tookaleader- .yy. ,7 A.; - <;. 4 1 i ship rolein this mcmitment. C. More than 20,000 new man-r ufactunng jobs wereannouncedin ?' the state during the year, and capital investments amounted to$2.3bil-tion. About $1.3 billion, or 57%, will occurin SCANA's service area. Examplesofcompanies that HasteningEconomhDewtopment ple visit the state each yearand have moved toSouth Carolinain the Cornoratepfts playa rolein spend about $3.5 billion. lastyearand a half readlikea who's hastening econonuc growth as well, Oneof thebiggestdrawsis whoinindustry:MackTrucks. and twoin particularare expected to Spoleto USA, Charleston'sinterna-Dana Corporation.The Allied Divi-pay bigdividerids to the state's tional arts festival, which annually sion of Gmmman Cmporation. economyin future years. SCE&G brings more than150,000 visitors to Justasimpressweis the donated much of theland and the famous port city. gmwth beingexperienced by com-buildings for the University of South Riverbanks Zooin Colum-panies which aniwd earlier. Mich-Carolina's S,vearingen Engineer-bia, one of the top 10 zoosin the elinTire Corporation,with four ing Complex, which willboast a United States according to Panute major manufacturing facilities in the powerftdnew supercomputer that magazine, delights over a half million state, broke ground mGmenvillein willbeimtalledin1988. Athree-people eachyear. 1987ferits new North American year,6600,000g-ant to Clemson I.ake Murray covers 50,000 headquarters. Pirelliannounced University willbe used to stimulate acresin centralSouth Carolina and plans fora research and develop-projects related to energyand eco-powers one of SCE&G's hydroelec-ment facility next toits fiberoptic nomicdevelopmentat Clemson's tricgenerating plants. Itis also cable manufactunng plant outside new EmergingTechnology Devel-home to thousands ofyear-round Columbia. NCR Corporation un-opment and MarketingCenter. msidents and attracts 200,000 water-spod enthusiasts annually. veiledits newestbusmess com- ,~g A new attraction willbe uter,which mpresented a $30 mil- {'onimestmentinits West y addedin 1988 when theSouth Caro-l lina State Museum opens.De Columbia plant. Robert Bosch Com-l a building that willhouse the Museum pany,asubsidiaryof theWestGer- .. -- m man automotive supplier, began a j.. was the first electrically-powered 3 textile millin the world.He elec-four-year,$170 milhon expansion of ' 1 trici was produced at a hydroelec-itsSouth Carolina plants. wg tric nt thatlater became part of l SCE&G's economicdevelop-ment team works withlocaland [
~~1. ; L What once were merely 2~~
state agencies to recruit new invest-ment from around the world. How-promisingopportunitieshave be-ever, wealso help prepare commu-come realities formanySouth nitiesin ourown backyard for Beaches, Parks,200s AndMuseums Carolinians. Educationally, eco-Pmsenutions to pmspectim South Carolina, with historic nomicallyand technologically, the mdustries. Charleston, the Myrtle Beach Grand stateis stronger today than everbe-Strand, Hilton HeadIsland and the fom and getting stronger. SCANA Blue Ridge Mountains, certainly is proud tobea part of this success doesn't need any help attracting and excited about the challenges ahead. tourists. More than 36 million peo. l
W R M Ma%.4+:p%MM bifpp $w$ %ph pgg p~ 2nwA4m 6:; gTi W. c.-S dj / i j. R _T U.N I;T I E S. L /j,1.eg i g'A ye y Ty,' f( h = ,3 ,e m .~ 3 c.yv;a c, [. ,N
~~i ) ' Reco/dSeJfricUsage Rate stability is one of the pri-i $j Q 9.,) ~,dh}'d [ @b~~
,l%..g ,3.l,.g. :' 17 establishing three historical peaks in 400 megawatts of electric generating ii SCE&G rustomers used re-l mary goals and[,roudest accom- .c 13.f cord amour f af electricity in 1987, plishments at S E&G. In July 1987, -.. ;,e j A- ? " M i E -).;./h ? i a one-month period, with the all-capability were n stored to the rate .1 ' 1. time mcord demand of 2,%3 mega- , base without the need for a rate in-E ic; [.:10 0.: crease. In December 1987, the S.C. K].V.6 '..MM,71,,0 l.M ;$.2 h ! watts (MW)occu v t f,91.. fi.j.h". # This series of records broke the pre-Public Senice Commission (PSC) or-E g Af v.3 :p Uptj 6, h.'?O.0 4 g sious nycord of 2,853 MW set Julv 9, ' dered a $27.6 million, or 3.7%, re-M, igg duction in retail electric rat 3. This N N.h a.. -G Systemwide sales rose 4.5% reduction reflected tax savings ex-MThelutweOfS0$fh Ca/0/ina( over the presious year, totaling 14.3 pected to be realized by SCE&G as a bIlect/ic&Na8Chipsnhd$th ' billion kilowatt-hours (KWH). Resi-result of the Tax Refomi Act of 1986, WastrongpundationolcustomerM;> dential sales were up 41%, commer-and a lowering of the company's al-g;,.. x s a m g.a,' cial sales 5.1% and industrial sales lowed retum on common equ'ity Dat/hfactionbackedbylbeM},L 4.2%. Wholesale and other electric from 14.25% t' '3.2557 effectiMan-c %gnicakmCompetentandSound 2 ? Anincreaseof 2.8% over red'uced SCE&G's retail electric rates' -. n a. i T sales increased 4.7%. uary 1,1988. 'l he PSC had previously ,u ]g " gggcM 1986 m electric customers contrib-by $25 million, or 3%, in February p m.ysr ::. .,y uted to the higher electric sales. 1987 to n>flect lower income taxes h.,CNM88Dd8lMI8 h : SCE&G was serving 417,778 electnc established in the Act. Enottole/Eteless."- MM [,fr) customers at year-end. Distribution Since Nbrch 19M, SCE&G's D % Y Q I 3 C M lf4s system pro ' cts were undertaken to residential electnc rates have fallen [p iPreddent a Chief 0pshly/ect/ic & [ O/#cer; meet the resulting k>ad growth and 11.9%, while average annual resi-S SS0Vth CJrofnah to improve senice reliabihty. dential usage has nsen 6.6%. ks[fe ;d%GasCompany~i-Bar codes Inake meters klyidentiMable bya scanner, which incords 2 M e p 6 [p ; f ' Ws *7y.fVL O m- ..-..s ..a ~~m <.e< z. mg ~, t h 8 W W W _ PUfPo***d :s d fbh &,;/ > rf,, l,!!'! ~ f 80ChC0d6l entering the i kg ; r n wyy N R J ELEGRIC TERRITORIAL PEAKU P_ fCONS,OLIDATED'ELEGRICDP:?J4 h (ELECIRIC CUSTOMERS N~ V M, d;- -; DEMAND 4 {SALEk eAtq)rwyN M# thousands; year-end)g' 4, g(billions of KWH af y1 .;e u y r ..(megawatts)? h Gp
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I 1 I E/#clentGenerationGetsEwnBetter counted for56% of this ca d; ductivity. Refurbishmentscontin-SCE&G continues toim-hydmelectric20%;nudear 5 ;and ued at five steam plants as part of the proveitsalreadyexcellentmcordof oiland naturalgas 9%. company's on-gomglife extension program for extstingelectric efficiencyin thegencrution of ele - gg tricity.The company's 1987 system gg"8'ne#tGsteers generating facilities. ProgramsBe CoalisSCE&G's primary heat rate for fossilplantswas9,920 BTU /KWH, markmg the fifth con-SCE&G's superb record of generation fuel. Our fossilplants secutive year tius important measure generatingefficiencycanbelinked bumed 4.6 million tons ofcoalin hasim-toaggressive pmgrams to maintain 1987, a 24.1% increase fmm 1986. ofgeneratingefficiency&Iburr and upgrade existing generating Efforts to reduce thecostsas-proved. In Ekctric Ught magazine'slatestannualsurvey of plants and transmission and distri-sociated withcoalhave paid offin thecountry's100 - t im'estor-bubon equipment. significant savings forourcus-owned utilities, had the Especially noteworthyis the tomers over thelast fewyears.The I eighth best fossil heat rate for 1986. installation of a computerized delivered costof coalhasdropped SCE&G has rankedin the survey's maintenance planning and sched-from $53.27a tonin 1984 to542.60a i top 10for thelast fimyearsandeight uling system at SCE&G's fossil tonat year-end 1987. SCE&G ofthelast nine. plants. Although the pmject willnot achieved thesesavingsbybuying Totalsystem generationin becompleted at allplants untilthe more coalatlowercost on thespot 1987 was15.4billionIGVH, up 5.7% summerof1989,benefitsare already market and byrenegotiating several fmm1986."hatinduded allelectric-being reahzedin trackingwork long-term purthaseand shipping ity pmduced by the A.M. Wilhams orders, scheduling preventive contracts. Stationin Charleston,whichis maintenance and measuringpro-owned by anotherSCANA subsidi-Q _."h".,N 7 :. l. _ gggesthStedenconsishnWyrM._,,, __sasansofm#e- ~, ary, South Cmtna Generating Company,inc.The totalg-eneration _ _ _ _,g, _ g,-. _ _, _ _ Q Stedes m, mixin 1987 was 74% coal,21% m_JJ pinersdeg g h t e nudearand 5% hydroelectric. MI~~M", ' o' "#Y ~I' f ity stood a fa ST@@dME 1,1988. Generation from coalac- !(W hosi ms e per ~ < y* g.. x a - f7y '* 47: vs x DiO M #'. a % 7 d N TGENERATIONWEl.iMDC'"*"~9 f 'N i s ^ < (includes G.EN,C.O) ? ' ' 1, . a.o ; w : e, + \\ 74' ,[. I .- ~\\ ' ' kh I EU1.[EN s I f' l fM, ly 'p$ .,.~v. g 7.7f t,@w' 9 'W f y. Nndear = 6 de Natun,d Gas. ~ n. -- m - g,.g x ( a y %xs .3 ..n 4
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sosiomjileiragbjednssozzflat)earimadmiikr#6aastri i 1 e m . -m -z ~ 0RlR $ $lt M QlfAV & Nh 8 018 t N M E & G b 8 Q. ChoicesForABetterWayOfLife ,9 wm s W ggMMuftfingigpgging@ Customerservice means J more than just pmvidinga good 1 y.7 1.. z - v. ~ N/MMNRIMM8kiMMM2K UN$8SIf?[. product at a reasonable price. It also y. f b' M M SN M% lSd II tcompi mIntanin-b P m t som#movavegnummenaampoamme dijduais [CE& s s u hlf 3 d ing thatin a number of ways. I ,,,~3.j. The majorityof ourresiden-d,. x h.,g., : '. a a. I $.4h .s. ~ h k,. tial electric customers are billed at a fc."A NgW g' - ,a ,9 standard rate. But otherswith non- 'd%.2 '/./'c,.y @N traditional lifestyles or those who are 1 b; pattems can saw with oui ' v-use ', @rh..; F ' willing to alter meir electric 'Isage l 3; e p: y T.4M, -G d . M &g '!l.. J,f @jiC ' 1, i.Y J: JUP and timeef-use rates. Resio,atial s, q ., '. f:C.S D customers whobuild or mtmfit their 4 1 A.v.; J homes to meet stringentconsena-g,hQdqp Y..E. C :.t. ~ 1. ' tion standards can save with a 4 g.;:,Q Q J.~
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b' j. tive savings te companies which u: 4 ';l.J.) '.[, F t /, b y.jJ/4 : !;. allow SCE&G todiscontinue their ', ~- 7. Q service during peak situations. / 7, _ M g:ThpMuuraekChnfACasper4E r By encouragingconserva-i ,. Gomy j tion and off-peak usage, SCE&G e du ' can delay the need for newgenerat-s,
~~SIsipolSodChmine c 3 lantsand maintain rate stabil-ingbut rates aren't the only options w~~
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.a.'- y y.. y'. -p.5 y p-ei ,. a e y bl w t ,s rg N :,. ^ L '.. ^ .? fV Marketing Programs vffer More 0ptions + D.3 ~ - d SCE&G's residential cus-i I h - [. [ ;~'-44.Q.. ,...g,;-s* d ! i ~ L f * ' *.'. h....'. ;$ a. ~.NC - W : ) $. Q tomers who qualifv can rvceive a re- ~ 6%J C .-J, h - j bate if thev replace'their old heating MJ I7 g.......,.. n 7. 4 W *, q
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, g, y AM.,, -plj Tf( _. _ l.c ;(7 j,5 p f. ; q.s F Ughtning arrestors and surge pro- ~ tectors are available to better protect ww ymi home applianced from electrical 1 .,.c.. p, ,iamage. Commercial and industnal p ? **' 1 -T N p' 7 customers can take advantage of ^ s/,. custom-designed back-up equi >- v% p4 2.. -. #* f m y -1 -_ - gs ment to assure an uninterrupti le [f.. :.... m g . ;.7 -v s ..s power source for sensi'ive, entical ne e--'.. mic oprocessing equipment during r-y %.,.. - mm
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_;=m~. ' D.,1 g y .n n c temporan semceinterruptionsor - 7 a > lNW.E '.,W# f,st:W'gV ts; M. extended outages. r ._,s QRiteAidbpeneNnesdistriM! ion centerin' Winnsbwo in May[ gp ; - gyg; Q1987.?ThsA77,000 square-fooffacilitjprovides'sewiceloi ' ~ p h.b...t.f}3 j - s m . 4 s m h,l_ ith Aidpharmacies in a tix-state area & l' ? ?AW 2 R f. ' l l N: i ~ 3 A o . m 'y 3.s ]* [g, : ,w,'
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1 ~ 4 x' s H.. 3 Heating anc a;r con 6tioning ceaiers help their ,f^, CUS!OmerS quahfy for SCB G s Energy Enras Y' 3 y o y progra'nS Inal pro OCe I'nanDa ' :nCento e5 y ' ' i8_" for imprCong the e%Clency Of ~ ma;ornOf"eaQCuances s y-ib g. s v._,7; ,,;t;. r
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m, N. - { 4.: 4 s J ita l $ m.g F g.in (W ".. r p.3-g ,r p 4, e q .m' ' i.. A' # +Mp -s. c <- a r. 3 s;j. m 9 r:0 2 f f l~ j h1 2 .M g [ e ReachingOutToSeniorCitizens frg 't f . il ff: N 3 sj' - M SCE&G has developed a l? 4 Qlb 6 y - j Q' 3. Q .j % Qpg[% %.Mi d b--~.. h - ~ ]j fth F ' ' j.1 3 'p number of corporate social responsi-l d g~,.y. ..,..['.,q%f bility programs to help meet the j N needs of the communities we serve. '..Q 9 m We s w +x v.. The purposes of the programs vary, , + p g. , 3 \\ 'y ' " ~ y ^'. ]& but the company's dedication to 6 l each one is strong. b 'f' t. 3 Oneof themoresuccessful h j 41 [r? ~_ xH.y> AJ. < qg ?.. - ~ .d Prohtrams is called Pro lect SHARE. A g-3 W.". $ f.7._%..i " y M't p@]a voluntary donation program sup-ported by nearlv 20,000 SCE&G cus-p tomers Project' SHARE provides Fig. . i
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/ 7 .' n.j. -7 direct financialassistance to the .s e u. .i. l.. 3 y. f t T n's ~ Nj d. 9.' needv during crisis situations. 3 f.' r These funds help qualified people 3,.. 7. '- fe . ~. 6 (M.gg. ' l, s. t - qa m 7g buy heating fuels to stay warm dur-g,.. ,. ; < R, "..... J.,.' ~ 1. /.. J. ' M l ing the winter and to pay for heat-EJy 4. M..4. . ~~ ~i -c m~ y 3 ing equipment repairs. Project a.- 'x-{ .s g% SHARE got its start from seed M.* ; ' C.: ff ~.].* ' W g1 / ; '.;. j..y7 y.e.f J l .Q.J,.h.Q ' ' W .Af s? Q money donated by SCANA stock- ,, ' c - holders In 1987, community action 2*. - 4 g , T ' W. ?.J a,...p,,...; .;.. ^. p ' 4 agenaes distnbuted more than n, ' e. ~ W;^.." i..O:. w. .t C' S $217,000in Project SH ARE funds to W 's w'N f,.4.. ti N.* E... X. m.s .1,353 deserving famtlies anti 7. M w i, - o' pg 'U.*9 +.k s p, individuals. y 3. ~. s 4 An increased emphasis is W:41 M ~ ' being placed on meeting the spe-1 ' ?. ' f.j.. V.:; M M. i% M @[??# M:-J. %(j dfic needs of our senior citizens. YM"M,'[M In cooperation with the local 7y Counalon Agingin Columbia, the N ,. 7 - 5:w e. '5^' C N.. Customer Assistance Department is aimed spsfically at elderly patients (ggg . ggg, -. _.gg; i{ p participatingin a pilot program x ,g recently released from hospitals. -y/jM~ gMfpg['[hgp% g7gffghMfMfNjnM. -e e ..c Home visits by nursing and phar- / a r a 3 p.+ ? macology students from the L'niver-n -u u ,,.- m ?llghtlymNnned(Ob0liCSlechnology/ = AmanufaCluiesfrontw sitv of South Carolina will ensure ?~'
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t - s <g 3 h; 4 s. n. M I go, V g i ~ a ~ r 1 ( SummerStationGetsHighMarks j SCE&G received good news ( mis i n(N C he e agency micased its latest assessment m o of performance at the V.C. Summer .~~ I + ~, NudearStation. ./- In aletter toSCE&G, the NRC commended the company for I its"highlevelofimpmved perform- ) j, ance" and "aggressive manage-i ment ture towards nudear ) L safe 'identifiedin the report, j wh covered the periodJanuary1, i 1986 through July 31,1987. ' ', A-s /nAuguSt12'7Madr ' a neNRC noted thatSCE&G i had taken a numberof steps toim-y "3; pr veplantoperationsdunngthat -;TfUdrSWilsM - m $$Qfp/ffg[~f[fngs(porp '
~~'; a time, tnduding the establishmentof a~~
~ .~ 4 d a management reviewboard to re- ,# MS8/flL(/phtDt. T/36h/St q j] view allunplanned shutdowns of _.fA r. the reactor. This review board's work i .4 bfnOf OfkSLf u#%,lldf-p 1 resultedin a reduction of the num-j CUS ber of unplanned shutdowns com-i =_ WASWGShi y{ ne company received even pamd with an earlierperiod. 11 - - S286. V-three/n00ths/afer0011 mom good news when theInstitute ^ bl WO NNhufing; )a re g 3 i CerefD00/8S/Of theState.- A] Station.B%yP' 8mmsatSummer ' "' ^ta ,,ridsth-' ~ ving all10ofits train-t f i in8 Programs accredited,SCE&G t became the 24th utility tobe nted i @u j full membenhipinINPO's National of.jhe.artfad/jty,- Academy forNudearTrammg. l I j g ap: t- .3 t .pf - j p p a tt 1 0- .J g A NwSummerphMMwa r .n 1 .,,. _. _. -. ~.. - u!m__ _ _. i 3 i k. y _,. mf. . -.- y .m.m w.,~., - c. c, m.s,r r L a 7 .s 9 s. p 3 m._ _.____ _ ' fbft i C 1, ~ _ ,m .hf.f.2048 frabbg AYCra.#._. j y i e h _r,s__ a. . N?, .A.: ] i 4 ' 4,: ___1. _,,_..u.J_______________.__
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~~?.. ::..% fl. [ ; {_ {. M j.G.'jfl } l REfuelingOutageASuccess ^ Summer Station also success-n.\\ . h M. t.,I.h. 4., %p, j '.; - Q M N~~
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q cant activity during the three-b].; q month outage involved tSe "shot g;...4 :.,.. ? 1.^ -W o ; peening" of steam generator tubes, . a.,.; % _ .. c,f. j+.. s n- . J c ri. t 9. y. c a -s. ge..>,. m .s u$. y 1 3 making them less susceptible to y p?. .E pfg ' b pg.{.. E li :. 4:*t & ? ... y cracking. J n' r.,, pl.t. ji
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( g. ?~' '. ~ 7 ;p ,f, V;. f q.. . ;. s 1 * ;).. 1.. -cs ( down from the previous vears .e 4 I', :. t 3 92.0, when the plant did not h{i f'( k. .r h >A M undergo refueling, but still Letter ,.7f '%g: k. ' M. ,g[yp : $(n~.O il. I ; M;3 9%: .i?.'. -l...S . ~J ' Wyh than the national average for nu- ? ^ C' g p 3 : l. ?,7.,:: l ' p "; 'y ..&;f[. ; j clear units. Capacity tactor is the g-E amount ot ek ctriatv a generating ff )... a p.0:, w g. i. "I ' f*.? y.;tg MJ 4 9plant produces compared to the hs,3.!..yQ 7 M'hQ
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.3~ M, M. W: ' E ated uninterrupted vear-round. , u 3m.. .y 7 ^- - '-) TransitSystemAllowedHigherFare y %cna ? -... yC: c M SCE&Gs deet of 108 buws f NONCRCorporationM tAXs / J 3M./. p. carned more than 8.7 million reve-e (p4 NU J B. nue pasengers in 1987, about y 4m. m y c;. e M;y y.c ('[neWeSlbuSineSST,, ' Q..*,v p-. 4 n .t.. DN i Co/nphler,NTOWerJ $. W U T.p i k -1N.c > 31,700 less than in 1986. Jh RE&G continued to bse n, p q y ki, 82/800,WUSOnl'el/ edin /f -~,N.h., $ d/5$: - u a, c; .3 4 money on its transit operations in 1987 despite on-going programs to fvr
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~~y % s - bruary19B?, Theb - ; 6.A.P+ gs 9.t.?;i . Ql s reduce costs. Total revenue was s3 2 n~~
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. sa. oo cy ....,. i m./ 1 million, while operating expenses g, j.computerwaSdeSigned,;,gi - 34 1' were $81 miUion. SCE&G is re-m n..elopedaddiSmann J :i. w x -pg i " >AWW'E H"""" ""' hi* " 8""* "d deb LR .. r e c ns mth the aties of Charleston an Vu/acturedatt/ieNCRM 4..g,pW h Caumbia to prmiae public A 0. iplantin WeStCo/umbia.' ', y 4. y(g g W m f transportation. ,,-..s tt s 1 In mober 1987, SCE&G pe titioned the PSC for an increase in ' ~- n 'W ., f N[' ~ the 3 cent base fare - the lowest in .p' -,4 - ? }%,b w 's A & a.A : the country. In December 1987, the - -.A ? .g i t I
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1 ~ 1 %. approwd an increase to N I Of f, 4 cents ettechve lanuary 1,1988 'C . s Although this increa'.e will .. T help reduce transit hwses it was dis- ~ s + appointing that the requested in- [' crease to $1 was not granted. M E&G continues to seek the estab- ~, Ilshment of publiclv subsidued Re-gional 'I ran ortation Authontks to [ reduce 115 To e In pnWiding publlC tra n sporta tion s 1 s r_ 3 ^ (; b'. m. e, _v ..g m.m.
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[ W ummmmmmmme===-- I 1 h Natura/GasSalesStressed who replace theiroldelectncwater piblebyutilizinga processcalled ThroughSalesforce, Marketing heatennvith more economicalgas electrofusion," wiiere electric cur-water heates, rentisused tobondthepipe. 'Ihe numberof naturalgas customenonSCE&Gs systemin-TrainingEllbrtsImproveService Systemimprovementscon-cmased by1.2% owr 1986to195,177 ToGasCustomers tinuedin 1987asa $30million proj-ct tomplacemore than 600 miles of at year-end 1987.Totalretailsales SCE&G expandedits train- ^ "8
~~were up 9.3% to300.2 million in8effortsintonewand exdtin therms. Residential, commercial fmntiersin1987 Undera andind sales mse 1.5%,~~
that requires 16d hoursof m fofu biaaid eIo ere SCE&dsna ralgas opera-be 8bedo of meet Peakeysupp}Y P# tions underwenta complete reor-housekolda liances Andtostay r yn garuzation duringthe fallof1987as abmast of the testin technol in keep-m pacewithinwstmentsto part ofa new strategy toincrease themeteringand pressum exPanc d improve the system, m, residentialsales along the compa-ti fnatural t rts basbocon-I".* mmPan gsWa ny's 5,399-mile distribution system. bmughtinona cmass na formed, trainedand challenged t duct traininbclasses' , gay rats. Aspedalsales forcewas SCE isalso taking admn- 'f~ m e a iden and recnut new customers. tageof new technologyinother . ppm. ndsionbasMfg8,ona me n 2 % n th r t s ma t ea fdentifyb' mentproblemsand "[*$rY'I987' target grou Customerswith as i lines near eirhomeswillbeto d quickly lutions. Faster emer-aboutthemeritsof asappliances; gency repairs to plastic pipe are also anddevelopersan buil emmfast-growingareas wherenatum!gasis ' \\: ...i available willbe encouraged toin-t. P 6 ciude pas appliances in tfieir plans. .f ' ~ . } Additionally,in 1988,SCE&C be-ganoffering rebates tocustomem grgy.E'.. i yma ' y- + 'g... e n-y. p 1 ~... 1 i i f i ~ f '~ ~ f,, ~ %.Q,,. g E h The newgas sales team is mykng cbsely with builders and encouraging them toindvde j I gas appliances in the homes theyconstmct l 1 l
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21 ~ s 5 L yy, ?- F,' u 3 4 .. U -9 i ,j p..e -h l. / s L' .:-.L, '), i e ENealShoals OSummer-Qaj ".L I ' ;", -'n EE Parr EH EFairfield Pumped Storage s, s McMeekin EColumbia Canal Saluda ECoit Columbia g ateree EStevens Creek EEUrquhart ,J Aiken ELECTRCOPEMDONS '- 'v E harleston pg William E Hagood E *> terr com6untionG.n.r,uon Faber Place e Hardeeville
~~" MucisarG.n. radon g Burton 4~~
~~E J - -- - y. jfg. L.- y.[ Tirzah Propane i Storege Caverns s .~ > f. 1 ', R li Hill C ~"~~
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~~.:e &' Supplementai Nn Gas Supplier '- r-N'a Columbia Myrtle Beach Aiken Orangeburg GASOPERADONS~~
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~ d Liquefied Natural Gas Charleston Plant Beaufort l 's na "a,
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~~6 i 35 ~ [ t. a 4 I. { S.C.PipelineCorporation~~
~~}L Responds ToCompetition~~
{f*""0$* *P""Y '** South Carolina Pi line otalnaturalgas purchased 4 Corporation (SCPC)is A's in-forresale,indudingspot market i + trastate naturalgas transmission urthases, totaled a mximately l 5 N subsidiary that serves resale and in- .0million MCFin 7, up fmm Lf j dustrialcustomersin allbut two of 65.4 million MCFin 1986.Hecost ] South Carolina's 46 counties. Resale perMCF dedined from $3.30in customersindudeci and county 1986 to$3.09in1987. i gasauthoritiesando er asutili-I SatelliteMonitoringOfPipeline pm w ties. At year-end 1987, was [SpMofkMWft serving approximately146 direct Passes Test gggg customers,indudin SCE&G Dunng1987,SCPC became { W-Purchases o as on the spot the first gas transnussion utility m i f Q Nppfd W il G a @ uC W Ne marketcontinuedto elpSCPCre-the nation to employa satellite te-y g dW 998 M g main competitive with altemate fuel lemetering ystemformonitoring G 2.MifMM0881F#4881N8 ' suppliersin 1987. Totalsalesin-and contro g the pipeline.He P#10E creased 8.4% over 1986 to 72.4 very smallaperture terminal (VSAT) i barnetpapegthasie N n million h CE Industrialsales were s tem exceeded allexpectations n- "b up by4.6% while sales to resale cus-urin extensivetestingandisex-W M N., tomersincreased by10%.De pect tobecome fully oparational gyMM$3 cg amount of gas transported for resale during 1988. customers and end-users rose nesystemwillbeinstalled pq ~ 'g g,+ ~" 32.4% wm red to 1986. in two phases. Phase 1invohes the 1 = ~ 'C So hem NaturalGas Com-placement of 25 smalltemunals to 0 a~ pany(Southem)and Transconti-transmitinformation about gas ml- ,<, 4 : nentalGas Pipeline C ration ume and flow from remot ints y fg (Transco) provide contract alongSCPC's1,657mileso pipe-1 s, yil gas uirements.The contract de-line. Phase 2 calls foranadditional mand 210,900 MCF perday with 15 temunals tobeinstalled. 1 Southemand 29,300 MCF perday ne finandalbenefitsof this V withTransco. SCPCalso purchases system willbeimmediate.He cost h [N*T>. signifiant mlumesof s market to transmit thisinformation across '.s. 7 4 gas thatis transported Transco localtelephonelineshasbeen j "C* " "..% and Southem on aninterruptible steadily mcreasing. Because ofits Nu m-basis.His arrangement assures fixed costs, VSAT willquickly pay g SCI'Ccustomers of a reliable supply foritself. {y o n c l l t 1, 2
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Corporation (SCPC)is SCANA' sin-formsale,induding spot market ...e fI trastate naturalgas transmission puithases, totaled approximately ,. ; 1 & ^. :, N h(... '. :.. / {) subsidiary that serves resale and in-72.0 million MCFin 1987, u fmm i w-dustrialcustomersin allbut twoof 65.4millionMCFin1986.'I ecost 7 y.-<3 ',2 1 f,.
~~South Carolina's 46 counties. Resale per MCFdedined from $3.30in~~
,1 .. gg...4.j ;-.. p, e. t, customersindude cityand county 1986 toS3.09in1987. 4 gas authorities and other as utili- .g.;.y.#. w - ,1 SatelliteMonitoring0fPipeline w OtM a ties. At year-end 1987, SC was 74848ka$r%WhoAAbrWSBSC sening appraximately146 direct Passes Test ggggp p Qc w -g customers,induding SCE&G. Dunng1987, SCPCbecame i A Purchasesof asonthespot the first gas transmission utility in f QUOWINIWNkORGIII marketcontinuedto elpSCPCre-the nation to employa satellite te-I gp-g g,L main competitive with altemate fuel lemetering system formonitoring 5 suppliersin 1%7.Totalsalesin-and controlhng the pipeline 'he i JW as M cD oir al W N W S N/] cmased by 8.4% over1986 to 72.4 very smallapeitum terminal ( JAT) l ( Aglyope8hapfCfAatjp.y % million MCE Industrialsales were system exceeded allexpectations j ep by4.6% whilesales to msalecus-durinktobecome fullyoperational extensive testingandis ex-n bu WC08980888818388#[ tomersincreasedby10%.The pectec . hguteneekdebrge." ".y amount of gas transported for msale during1988. l "4 + gg customers and end-users mse 'Ihe system willbeinstalled n0 g. 32.4% compared to 1986. in two phases. Phase 1imuh'es the . gy-Southern NaturalGasCom-placement of 25 smalltermmals to Southem)and Transconti-transmitinformation about gas vol-G .m 1 pany(lGas PipelineCo ? a H nenta ration ume and flow from mmote ints Nl M"_ (Transco)provideSCP contract alongSCPC's 1,657 miles o pe- ,e l f ' 2 A gas rec luirements. Thecontract de-line. Phase 2 calls foranadditional b g mandis 210,900MCF perday with 15 temunals tobeinstalled. 2 pr ,9- + g: Southem and 29,300MCF perday 'Ihefinancialbenefitsof this F
~~ggg withTransco.SCPCalsop tthases system willbeimmediate.Thecost F~~
sA significant mlumes of spot market to transmit thisinfonnation acmss k therms) > q gas thatis transpotted byTransco localtelephonelines has been mum 6. @g aws es gw m sem m ama, j. and Southem onanintermptible steadily mcmasing. Because ofits 2 d 1 basis. This arrangement assures fixed costs, VSAT willquickly pay h.j 'm g mg SCPCcustomersof a reliablesupply foritself. l ? .l i 1 l l . *j ---~~~-~-e~-e L_.% ~:-,.-1 1 _w-scpc4 -m m._neneg_eWass_aras_sessesy a E-.- 3 .I _._ _ yl y -a' Y.., h. h 'N - ~.- f ~. - - ~ 9' s ] 9^ i i a.
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w y I (! Construction,RealEstate AggessinMarketingPaysOff 5y;g gy, gage, postu7e' basedonqukaproductsand excel-g CogeniesActim forSCANASoftwem M Primesouth,Inc., SCANA's SCANA SoftwareSenices, lencein senice,is positioning F constructionand design subsidi-Inc.be anaggressivemarketingof SCANASoftwareforcontinued F ary, ended 1987ona successfulnote itsp uctsand senicesin1987, growth. Inaddition to holdin at 4 bysigninga majorcontractasan and this effort is proving successful. promise for the futum, this F authodzed builder for American Dunng1987,SCANA Soft-technologyventure has con ted BuildingsCompany,oneof the ware signed contractswith several to theeconomicdevelopmentof largest manufacturers of metal build-utilities for the sale of a Fleet Man-South Carolina through the creation mg systemsin the world. Contracts agementSystem, which allowscom-of 70 newjcSs. - awarded to Primesouth dudng1,987 panies to manageand analyze their induded a new U.S. Post Officein equipment purchasesand mainte-MPXContinuesGrowthStrategy Charleston;a majoraddition to the nance activities morecost effec-Anotherhigh-tech subsidiary headquarters of a regional bank; sig-tively. In addition, SCANA Soft- -MPX Systems,Inc., a provider of nificant renovationsat a county wam contracted with a gas utility to fiber optic telecommunications ser-2 hospital;a145,000 square foot m-pmvidea customized Distdbution vices-also had a good yearin1W. searchanddevelopment faciliy; ConstmctionInformationSystem MPXincreaseditsimestmentin andan aircargobuildingforthe to satisfy specific construction man-SouthernNet,aninterstatecanier Columbia Metmpolitan Auport. agement requirements. As a result that presides telecommunications Primesouth achieved profitability in of this project,SCANA Softwarewill services to Washington, D.C. and 1987, its first full year of operation. haua newgas system toadd toits seven southeastern states, toa South Camlina RealEstate pmduct portfolio. 15% interest asof December 31, Development Company,Inc. SCANA Softwarealso estab-1987. Equity camings from thisin-(SCRED)continueditsinvohe-lished anintemationalpmsence vestment andincome from the fiber ment during1987in businesses dudng1987.The Sevem-Trent opticlinesbuilt and operated by ranpgfrom majorindustrialparks WaterAuthontyofBirmingham, MPX madea positivecontribution England signed a contract fora s toSCANA's eamingsin 1987. to single-family msidential develop-ments. SCREDcompleted a shop-ciauyadapted version of the con.pe-Plansambeing made toadd approx-pingcenterand abusinessparkm structioninformation system to imately70milesof6beroptichnes Columbia,and an officebuildingin meetits needsin theUnited in SouthCarolina. Charleston. Anotherofficebuilding Kingdom. is underconstmctionin Charleston. e e G Z Z E h
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J SCANA CORPORATION i 4 Groefors OMcers i J.K. Addyu T. C Nichols,Jr. John A.Wanen*. Pnsnient Pmsident Chaumanof theBoartiand' Addy Dodge,Inc. SouthCarchna Electnc& ChiefExecutheOffimr 1.edngton, South CanAna GasCo apany L M. Gressette, Jr.7 W. B. Bookhart,Jr.2.3 Colunt imthCansna PnsidentandTreasumr W. B. Bookhartliums E. W. Pike, Jr.u Cathy B.Novinger Pnsamt SmiorVicePasxlent Ellon*, South CanAna ColomalDewlopmentCompany Admuustrationand J. B. Edwards, DMD" Beaufort, South Caroin. GowmmentalAffairs Pasidmt W. B.Timmerman MedicalUniwrsityof SouthCarchna HenryIbnder, Ph.D.t$ SeruorVxtPmsidentandController Garleston,SouthCarodru Pasident GiefFinanaalOfficer L M.Gressette Jr. FiskUnhersity President. Nashville, Tem C B McFadden V$ePresident SCANACorporation J. B. Rhodesu PlanningandCorporateSeni s Columba, South Carohna ChiefEm:utimOffixr J. B. G 'ess,IIIL2 [d t Vice Pnsident Owm IntemalAudit EdistoFarms V. C Summeru Denmark, South Carohna Gaumanof theBoard Emeritus Barbara D.Blair8 BA Hagoodu SCANACorporation SW Pmsxlent Columba, SouthCarchna HaniettM.Gardner i Wm. M. Bird and Co.,Inc. E. C Wall, Jr.u AssisMSecmtary Garleston,SouthCarohna Pnsdent J. F. Hassell,Jr.u CanalIndustries,Inc. RehiQuimunand Conway, South Camlina ChiefExecutiwOffm John A. Warrent Pn-Stress Conate Company,Inc. Ouumanand Ourleston, South Carolina GiefExecutheOfficer W. H. Hippu SCANA CorporationandSubsidiaries PnsidentandGiefExectitiveOffxrr Columba, South Cambru TheUbertyCorporation Greemille, South Caroluu DmforsFstieriti Avram Kronsbergu W. R. Bruce Pmsxlent K W.Fmndt Hamson & Com ,Inc. E M. Hipp Ihiemterof ExecutiwCommittee Ourleston,Sou Carolina J. H. Lumpkin 2hiemtvrof Audit Committee . C. Mustard 3 F C ?'.icMasteri, htemberof Corporate twformance and J. E. Sduchte,Jr. Strategic PlannmgCommittee a h Company J B mith 17na IDN tEnu dmmi(1-3-88) 5hiember of Nuclear Owrsight Committee W. H. Taylor 6Also Chairman and CEO of au subsidiaries d e m iG-1 M ) 7Also Vice Chairwn of all subsidaries where j heis not President 6 l sSecretary forau subsidiaries - i. 1 i 1 (.
dieu South Caroline Electric & Gas Company South Carolina Pipeline Corporation T. C Nichols,Jr.' R. D. Hazel hiax Eanmodio hidentand VrePmsident hident NOperatingOfficer Rmnneland Corporate R. hi. Kightlinger Conununications O. W. Dixon,Jr. VrePmsident ExecutimVice Pasident B. T. Horton, Jr. Supplyand Engintuing Operations Vice PmsidentandTmasumr B.J. hiacInnis C L Rye John Kinloch Vre Pmsident SeniorVicePresident Vrehident Operations IberDelimyandTransportation Transitand Reet hiaintenance B. hi. Smith,Jr. S. C hichfeekin,Jr. Primesouth,Im SeniorVre President VrrPnsident E. H. Crews, Jr. Corporateand Customer Relations-President Econonue Dewlopment Northern Disision J. hl. Woods J. H. Young,Jr. D. C hicNamara Vice Pmsident SeniorVre Pmsxient Vre President J. C. Chapman Customer Relations Marketing VicePresident G.J. Bullwinkel,Jr. D. A.Nauman Vre Pmsxient Vre President South Carolina RealEstate Develooment Customer Relations. NudearOptrations Company,/m E. C Roberts J* W. Weddin V R. Coward, Jr. Vre Presxlentand GeneralCounsel President Vrehident PatriciaT. Smith A* H. Gibbes SupportSemes Vre President VrePmsident G. C Croft,Jr. Ihhasingand Regulatory Affans YcPWSident W. E. hfoore SCANA SoftwamServices,Inc. Trarmmonand Distribution Assistant Vre President Engirming Production Enginetsing W. A. Darby K. B. hiarsh Vre Pmsident J. D. Gregg ControDer GasOperations Vre President J. G. Black,II Operations AssistantTreasurer
~~Also President of South Carolina Generating Company, Inc., South Carolina fuel Company, Inc., and Carotane,Inc.~~
10Also Vice President of SCE&G and President l of minor pnyune sutwidianes
+ 9 ,7 k -?' y s E E l E P IE hI L m F l L su 0 R I. E E F Y r N li h e w E L-E K: E L ? F-T ? ?
1 lM ~ StANA0ERENT REPQRT_ ' He Management of SCANA Corporation (the Com-and guidelines and is complemented by the sekxtion, train-pany)is responsible for the preparation and integrity of the ing and development of professional fuuncial nunagers h'nancial data induded in the accompanying Consofidated and by a staff of intemal auditors who conduct comprehen-Financial Statements. Rese statements haw been prepared siwinternalaudits. in confomiity with generally accepted accounting pnnaples De Board of Directors prusides owrsight for the orepa-as applicable. In situations that prewnt exact accounting ration of the financial statements through its Audit Commit-measurements, management has used informed judgments tee, which is composed entirely of nonemployee directors. and estimates. Financial information presented elsewhere in The Audit Committee meets penodically with management this Annual Report is consistent with these fuuncial and internal auditors to review their actisities and responsi-statements. bilities. The Audit Committee also meets periodically with the Th : Company maintains and relies upon a system of Company's independent auditors, Deloitte Haskins & Sel!s. intemal an:ounting controls designed to provide reasonable De internal and independent auditors haw free access to assurance that all transactions are properly recorded in the the Audit Committee to discuss intenul accounting control, l books and records and that assets are prutected against loss or auditing and financial reporting matters. unauthorized use. The degree ofintemalaccountin control is based upon the determination of the optimum baf>mce /M -m between the cast incurred in maintaining a system of inter-W B. Timmerman nal controls and the benefits to be derived. The system of. Senior VrePresident internal accounting controls is supported by wntten polices Chie/Financia/0//icty 0 2 l'N I Q N 0.9 l H D'$ P E N O E N^T l ^ ~ , C E R T I F I E. D P U $ L I.C 'A C C O Uh T A N T S ' I. I Del 0itt0 se e Haskins+ Sells
==.t= c.- SCANA CORPORATION: We haw examined the Consolidated Balance Sheets In our opinion, sudi Consolidated Financial State-and Consolidated Statements of Capitalization of SCANA ments present fairly the consolidated fuuncial position of the Corporation and consolidated subsidiaries ("Company") as of Company at Dewmber 31,1987 and 1986 and the results of its December 31,1987 and 1986 and the rela ted Consolidated operations and the changes in its fuuncial position for each Statements of income and Retained Eamings and of Sourws of the three years in the penod ended December 31,1987, in of Funds for Gross Property Additions for each of the three cenformity with generally accepted accounting principles ap years in the period ended December 31,1987. Our exanuna-plied on a consistent basis. tions were made in accordance with generally accepted audit-ing standards and, accordingly, included such tests of the accounting records and such other auditing procedures as we
~~f considered necessary in the circumstances.~~
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31 o C0NSOLIOATED BALANCE SNEETS December 31, 1987 1986 ASSETS (DwusaruisofDollars) Jtility Plant (Notes 1,2,3and4): Electric $ 2,574,138 S 2.475,332 Gas ~ 292,990 277,292 Transit 4,024 4,188 Common 37,102 23,622 Total 2,908,254 2,780,434 less accumulated depreciation and amortization 797,752 722,996 Total 2,110,502 2,057,438 Construction workin progress 95,013 92,379 Nudear fuel, net of accumulated amortization 62,445 51,535 Acquisition adjustment-gas, net of accumulated amortization M,148 35,146 UtilityPlant, Net 2,302,108 2,236,498 OtherPropertyandImestments: Nonutility property (substantially at cost) 40,789 30,331 Investments (Note 1) 29,076 19,213 TotalOther PropertyandImestments 69,865 49,M4 Current Assets: Cash, temperary cash imestments and special deposits 22,195 10,913 Receivables 105,041 107,078 Imentories(ataveragecost): Fuel (Note 3) 61,025 M,768 Materialsand supplies 24,M1 18,433 Pirpayments 13,307 15,323 TotalCurrent Assets 226,109 206,515 h Deferred Debits: Unamortized debt expense 6,790 5,474 Accumulated deferred income taxes (Notes 1 and 7) 17,M3 11,208 Unamortized deferred retum on plant imestment (Notes 1 and 2) 40,335 36,395 Nudear plant decomnussioning fund (Note 1) 7,238 5,128 Other 32,081 24,570 TotalDeferred Debits I N,287 82,775 Total $ 2,702,369 $ 2,575,332 See Notes to Consol. dated FmancialStatements. ) I a
^ ^ _.p. December 31, 1987 1986 CAPITALIZATION (See Consolidated Statements of Capitalization) (ThousmisofDollars) Stockholden'Imtstment: Common Equity $ 871,620 $ 836,913 Preferred Stock (Not Subject to Pmthase or Sinking Funds) 26,029 26,029 TotalStockholders'Imustment 897,649 862,942 ~ Preferred Stock (Subject to Purchase or Sinking Funds) 84,632 117,542 Long-Term Debt, Net 886,993 745,451 TotalCapitalization 1,869,274 1,725,935 LIABILITIFE Cunent Liabilities: Short-termborrowings(Note 8) 21,565 80,576 Curmnt portion of long-term debt, net (Note 3) 24,719 21,930 Accounts payable 82,789 82,068 Customerdeposits 15,260 13,417 Taxes accmed 36,400 45,836 Interestaccmed 16,684 12,147 Dividends declared 25,621 25,966 Other 6,790 3,715 TotalCurrent Liabilities 229,828 285,655 Deferred Credits: Accumulated deferred imestment tax credits (Notes 1 and 7) 117,177 119,766 Accumulated deferred income taxes (Notes I md 7) 416,700 388,789 Accumulated reserse for nudear plant decomcGsioning (Note 1) 7,238 5,128 Other 62,152 50,059 TotalDeferred c edits 603,267 563,742 r Commitments and Contingencies (Note 9) Total 5 2,702,369 $ 2,575,332 I See Noles to Consoldated Fe,ancialStatements. l l [
32 CONSOLIDATEO STATEMENTS OF i INCOME & RETAINEO EARNINGS Forthe Years Ended December 31, 1987 1986 1985 (DiousandsofDollars excqqvrshareamounts) Operating Revenues (Notes 1and 2): Electric $ 806,826 $ 809,488 $ 787,796 Gas 305,934 289,429 318,856 Transit 3,212 3,119 3,689 TotalOperating Rewnues 1,115,972 1,102,036 1,110,M1 Operating Expenses: Fuelusedin electricgeneration 227,877 216,076 229,249 Pbwerpurchased, net (12,486) (2,823) (8,821) Gas purchased forresale 222,319 215,928 246,760 Other operation 169,356 155,588 143,016 Maintenance 57,995 56,8M 60,836 Depreciation and amortization (Note 1) 92,583 90,627 86,899 income taxes (Notes 1 and 7) 95,051 119,108 105,783 Other taxes 58.892 51,952 49,021 TotalOperating Expenses 911,587 903,320 912,743 Op(ratingIncome 204,385 198,716 197,598 OtherIncome(Note 1): Allowance for equity funds used durin constmction 2,063 1,2M 1,086 Deferred retum on plant investment (Note 2) 6,063 12,450 12,881 Other income (loss), net of income taxes (1,731) (3,889) 1,7M TotalOtherIncome 6,395 9,825 15,721 Income BeforeInterest Charges and Preferred Stock Dividends 210,780 208,M1 213,319 Interest Charges (Credits): Interestonlong-termdebt, net 68,119 68,180 83,81'/ Otherinterest expense 5,155 5,771 1,789 Allowance forborrowed funds used duringconstmetion(Note 1) (1,796) (2,017) (2,388) TotalInterest Charges, Net 71,478 71,9M 83,218 Preferred Stock Cash Dividends of Subsidiary (At stated rates) 10,437 14,443 16,M1 ) Nctincome 128,865 122,1M 113,560 Retained Eamings at Beginning of Year 262,671 '30,M9 202,988 l l Common Stock Cash Dividends Declared (Note 5) (93,487) (90,263) (87,N0) l Other Capital Stock Transactions, Net (929) 221 1,N1 Retained Eamings at End of Year 5 297,120 $ 262,671 $ 230,M9 Eamings Available for Common Stock 5 128,865 $ 122,1M S 113,560 Common Shares Outstanding (Thousands) 40,2 % 40,296 40,296 Eamings Per Share of Common Stock 53.20 $3.03 $2.82 See Notes to Consolidated FinancialStatements.
C 0 N s 0 L I O A T G O& sy A T R At s N r s ~ 0 F s o u R C e s. O F 'F U N D S ~ ~ 10 RJ.0 5 0:9 S3 t%%$R'T VMMOff) 0 NlsL ^ For theYears Ended December 31, 1987 1986 1985 SOURCES OFFUNDS (Thousands ofDtGm) Internally Generated: Netincome 5 128,865 $122,1M $ 113,560 Charges (credits) to income not requiring (providing) funds: Depreciation and amortization 92,583 90,627 86,899 Amortization of nudear fuel 17,1 % 30,529 22,612 Deferredincome taxes, net 20,627 33,635 /2,497 Deferred investment tax credits, net (2,589) (9,593) 821 Allowance fc.r funds used during constmction 0,859) (3,281) (3,474) Deferred retum on plantinvestment (6,063) (12,450) (12,881) Other, net 1,994 2,020 1,444 Funds provided from operations 248,7M 253,651 251,478 Deduct cash dividends declared on common stock 93,487 90,263 87,NO Intemally Generated funds, Net 155,267 163,3SS IM,438 Extemal Financing: Mortgage bonds sold 100,000 Pollution controlbonds sold 4,365 1,100 5,500 Bmk note sold 40,000 Increase (decrease)in fuel finandngs, net 13,938 (19,813) (8,256) Reduction oflong-term debt s13,001) (89,459) (44,966) Retirement of preferred stock (32,910) (35,205) (4,275) Increase (decrease) in short-tenn borrowings, net (59,011) 78,188 1,915 Funds from Extemal Financing 53,381 (65,189) (50,082) Other Sources (Uses): (Increase) decrease in working capital, exduding short-term borrowings and current portion of long-term debt (19,199) 29,273 15,N8 Other changes in noncurrent balance sheet items, net (19,990) 13,424 (4,3 71) Other Sources (Uses) (39,189) 42,697 10,677 Funds for Property Additions 169,459 140,896 12.5,033 Allowance for Funds Used During Construction 3,859 3,281 3,474 Gross Property Additions $ 173,318 $ 144,177 $ 128,507 See Notes to ConsoMa!ed FetanaalStatements.
I i 4 1 .C O N S O L I D A T 0 S T A T E AG E N T S OF CAPITALIZATION December 31, 1987 1986 Common Equity (Note 5): (Thousands of Dollars) Common stock, no par value, authorized 75,000,000 shares, issued and outstanding; 1987 and 1986 - 40,296,147 shares $574,500 $574,242 ~ Retained eamings 297,120 262,671 TotalCommon Equity 871,620 47% 836,913 49% i i South Carolina Electric & Gas Company: Cumulative Preferred Stock (Not Subject to Purchase or Sinking Funds): Shares Outstanding Redemption Price Eventual Series 1987 1986 Current Through hiinimum $100 Par 8.40 % 197,668 197,668 104.70 11 30-91 101.00 19,767 19,767 1 $50 Par 5.00 % 125,234 ' 125,2M 52.50 52.50 6,262 6,262 Total Preferred Stock (Not Subject to Purchase or Sinking Funds) 26,029 1% 26,029 1% South Carolina Electric & Gas Company: Cumulative Preferred Stock (Subject to Purchase or Sinking Funds)(Note 6): ) $100 Par Value - Authorized 1,550,000 shares Shares Outstanding Redemption Price Eventual Series 1987 1986 Current Through hiinimum 7.70 % 108,000 113,894 101.00 101.00 10,800 11,389 8.12% 153,986 162,086 102.03 102.03 15,399 16,209 13.88 % 250,000 25,000 261,986 525,980 $50 Par Value-Authorized,1987-1,716,086 shares; 1986 -1,728,786 shares SharesOutstanding Redemption Price Ewntual Series 1987 1986 Current Through hiinimum 4.50 % 30,400 32,000 51.00 51.00 1,520 1,600 4.60 % 12,834 14,3M 50.50 50.50 642 717 4.60% (A) 42,052 41,052 51.00 51.00 2,102 2,202 4.60% (B) 102,000 105,400 50.50 50.50 5,100 5,270 5.125 % 80,000 81,000 51.00 51.00 4,000 4,050 6.00% 108,800 112,000 50.50 E 50 5,440 5,e00 8.00% 240,000 300,000 50.50 1-3(M8 50.00 12,000 15,000 8.72 % 315,125 365,400 53.00 12-31-88 50.00 15,756 18,270 9.40 % 237,456 244,692 51.175 51.175 11,873 12,235 1,168,667 1,298,8 _78 Total Preferred Stock (Subject to Purchase or Sinking Funds) S4,632 54 117,M2 7% See Notes to Consolidated FhinaalStatements.
r 31 December 31, 1987 -1986 long Term Debt (Notes 3and 4): (Thousands ofDa'lars} South Carolina Electric & Gas Company: First and Refunding h{ortgage Bonds: Yearof Series hiaturity 5-1/2% 1987 6,176 4-7,8% 1988 10,000 10,000 10-1/2 % 1990 7,800 8,400 5% 1990 10,000 10,000 5% 1991 8,000 8,000 4-7sB% 1995 16,000 16,000 5.45 % 1996 15,000 '15,000 6% 1997 15,000 15,000 l 61/2% 1998 20,000 20,000 8% 1999 35,000 35,000 9-1/8% 1999 15,000 15,000 8% 2001 35,000 35,000. 7-114 % 2002-30,000 30,000 9-1/8% 2006 50,000 50,000 8.40 % 2006 50,000 50,000 84B% 2007 30,000 30,000 8.90 % 2008 30,000-30,000 10-1/8% 2009 35,000 35,000 9-7,3% 2009 50,000 50,000 12.15 % 2010 35,890 35,890 3-3,'4% 2017 100,000 Pollution Control Facilities Rewnue Bonds: 4-1/2% Series, due 1987 1,031 5.95% Series, due 2003 7,220 7,285 Fairfield County Series 1984, due 2014 (variable rate-5.0% through !V3188) 57,000 57,000 Richland County, due 2014 (variable rate - 5.0% through fv31/88) 5,210 5,500 Fairfield County Scries 1986, due 2014 (variable rate-5.375% through tV31/88) 1,100 1,100 Colleton and Dorchester Counties Series 1987, due 2014 (variable rate-5.375% through 8/31/88) 4,365 Consolidated hiortgap%,due1997 Gold Bonds 5% Series, due 1999 (noncallable) 949 919 Lease Obligation,5-3,4 225 240 South Carolina Generating Company,1nc.: Berkeley County Pollution Control Facilities Rewnue Bonds, due 2014 (variable rate -5.875% through 9/3038) 3.1,850 35,850 Bank Note, due 1990 (variable rate-7.75% at 12/31/87) 75,500 78,500 South Carolina LNG Company,Inc.: 10-1/2% Series First hjortgage Bonds, due 1990 3,450 4,600 South Carolina FuelCompany,Inc.: Nuclearfuelliability 63,833 52,991 Fossilfuelliabili 20,129 17,083 South Carolina Pi line Corporation: 6% Series A Fi t hiortgage Bonds, due 1988 675 1,319 South Carolina Real Estate Development Company, Inc.: Notes, due 19871991 (at various rates) 47 77 SCANA Corporation: Bank Note,8.32%, due 1989 10,000 Total 913,293 767,991 Less-long-tenn debt maturities, including sinking fund requirements 24,719 21,930 Unamortized discount 1,581 610 Tota 1 Long-Term Debt 886,993 47 % 745,451 43 % Total Capitalization $1.869,274 100% 51,725,935 100 % See Notes to ConsolidatedFnstcalStatements. I
NOTES TO CONSOLIOATED FINANCIAL S T A T E nt E N T S i
~~f. Summary o/Significant Accounting Policies:~~
mately $877 million. Accumulated depreciation associated with SCE&G's share of Summer Station was approximately $130.1 mil-lion and $96.1 million as of December 31,1987 and 1986, respec- - A. Organization and Principlesof Consolidation tive SCE&Gishareof thedirectex iscs associated with operat- , SCANA Corporation (the Company), a South Carolina corpo-ing ummerStationisindudedin Company's"Other ration, is a ublic utility holding company within the meaning of operation" and "Maintenance" expenses. the Public tility Holding Company Act of 1935, but is exempt from registration under such Act. D. Allowance for Funds Used During Construction Re accompanying Consolidated Financial Statements re-Allowance for funds used during construction (AFC), a non-flect the consolidation of the accounts of the Company and its cash item, reficcts the period cost of capital devoted to plant under whouy owned subsidiaries: construction. Bis accounting practice results in the indusion, as Regukted utilities a component of construction cost (construction work in prog-South Carolina Electric & Gas Company SCE&G) ress), of the costs of debt and equity capital dedicated to construc-South Carolina Generating Company, In(c. (GENCO) tion imestment. AFC will ultimately be induded in ra te base South Carolina FuelCompany,Inc. imestment and depreciated as a component of plant costin South Carolina Pipeline Corporation (Pipeline Corpora-establishing rates for utility services. The Company's regulated tion) which whouy-owns South Carolina LNG Com-subsidiaries calculated AFC using the following overall rates (com-pany, Inc. and Carolina Exploration Corporation Puted on an after-tax basis): - Non-regukted businesses Carolina LPGCorporation 1987 1986 1985 Carolina Propane Storage Corporation SCE&G g4% 6.3% 9.5% Carotane,Inc. GENCO 5.3% 5.3% 5.7% MPX Systems,Inc. Pipeline Corporation 8.6% 8.6% 9.5% Primcsouth,Inc. These rates do not exceed the maximum aUowable rate as ]re 'Incl calculated under FERC Order No. 561. bterest on nudear fuel,in A A Process (refinement, conversion, enrichment and fabrication) is South Carolina Real Estate Development Company,Inc. C8P tahzed at the actuaHntmst amount i Tirzah Corporation Imtstments in an interstate telecommunications carrier E. Deferred Return on Plant Investment and in real estate, propane storage and transmission joint ven-Commencing July 1,1987, as approved by a July 1,1987 PSC tures are reported using the equity method of accounting. Signifi-order, SCE&G ceased deferdng carrying costs associated with 400 cant intercompany balances and transactions have been elimi-MW of electric generating capacity previously remowd from rate nated in consohdation. base and began amortizing the accumulated deferred canying co,ts (a pproximately $40.3 million at December 31,1987) on a B. Systemof Accounts straight-linebasisowraten-yearperiod(seeNote2A). Amortiza-The accounting records of the Company's regulated subsidi-tion of deferred carrying costs, induded in "Depreciation and aries are maintained in accordance with the uniform system of amortization", was approximately $2.1 million for 1987. accounts prescribed by the Federal Energy Regulatory Commis-SCE&G's deferred return on plant investment meets the cd-sion (FERC) and as adopted by he Pubbc Service Commission of teria for financial accounting recognition as prescribed by the South Carolina (PSC). Financial Accounting Standards Board (FASB) Statement No. 92 b " E C. Utility Plant Utility plant is stated substantially at original cost. The costs of h Depreciation and Amortiration additions, renewals and betterments to utility plant, including Provisions for depreciation are recorded using the straight-direct labor, matedal and indirect charges for engineering, super-line method for financial reporting purposes and are based on the vision and an allowance for funds used during construction, are estimated service U ves of the vr.rious classes of property. The com-added to utility plant accounts. De original cost of utility property posite weighted-average depredation rates were as follows: retired or otherwise disposed of is remowd from utility plant ac-counts and generally charged, along with the cost of removal, less 1987 1986 1985 salvage, to accumulated depreciation. De costs of repairs, replace. ments and renewals of items of property determined to be less {E j.4 jj than a anit of property are charged to mamtenance expense. Pipeline Corporation 2.43 % 3.37 % 3.27% SCE&G, operator of the V C. Summer Nuclear Station (Sum-overall 3.2t.% 3.38 % 3.35 % mer Station), and the South Carolina Public Service Authority (a public corporation of the State of South Carolina) are joint owners Nuclear fuel amortization, which is included in "Fuel used in of Summer Station in the proportions of two-thirds and one-third, electric generation" and is recovered through SCE&G's cost of fuel, respectively. The parties share the operating costs and energy is recorded using the units-of-production method. Provisions for output of the plant in these proportionss The total cost of the amortization of nudear fuelindude amounts necessary to satisfy construction of Summer Station was appnnimately $1.3 bdlion, or obligations to the United States Department of Energy under a about $1,461 per kilowatt, of which SCE&G's share was approxi-t ontract for disposal of spent nudear fuel. I
Re acquisition adjustment relating to the purchase of certain I. Pension Expense gas properties in 1982 is being amortized overa forty-year period De Company has a noncontributory defined benefit plan using the straight-line method. covering substantially all emp!ovees. Benefits a re based on years G. Nuclear Decommissioning f accredited senice and the employee's average annual earnings Decommissioning of Summer Station is protected to com-received during the last 3 yea rs of employment. ne Company's mence in the year 2014, and the expenditures (on a before-tax policy has been to fund pension costs actrued to the extent per-basis) related to SCE&G's share of decomnussiorung activities are mitted by the applicable Federal income tax regulations as deter-currently estimated to be a proumately $211 million (in 2014 dol-mined byindependentactuaries. The Com adopted FASB Statement No. 87, "Employers' lars). SCE&G is providing or estimated decommissionmg costs owr the life of Summer Station and has established a resene for Accountingfo i sions", as of January 1,1987, which requises, this purpose. SCE&G is presently funding the reserve with among other things, the use of the projected unit credit actuarial amounts collected through electric rates (approximate $.8 million cost method for determming net periodic pension cost for finan. cialre rtin pu annually, net of taxes), and intends for the fund, mdu g standa d difnot .The adoption of the new accounting eanungs, to pmvid 'or all eventual decommissioning expendi-significant effect upon the Company's tures on an after-tax oasis. financial position or results of operations. Be new standard was t adopted prospectively, and accordingly, pension related disclo-
11. Income Taxes sures for prior years have not been restated. Total pension cost for The Company and its subsidiaries file consolidated Federal 1%7,1986 and 1985 was approximately $9.6 million, $10.4 million and State income tax retums. Income tanes are allocated to all and $8.3 million, respectively.
subsidiaries based on their contributions to consolidated taxable Net penodic pension cost, as deternu,ned by an independ-ent actuary m accordance with the provisions of Statement No. l Ek ause tax laws and financial accounting standards differ 87, for the year ended December 31,1987, included the following in their recognition and meas.irement of economic events, differ-C mPonents: ences arise between (1) the amount of taxable income and re-ported pre-tax financial income for a year and (2) the tax bases of Year Ended December 31, 1987 assets or liabilities and their reported amounts in financial state-mousands of Douars) ments. Accordingly, the Company provides deferred income Service cost-benefits earned duringhe period 5 6,057 ly']t n prog,edgnent g ion 14 taxes for substantially all timing differenses, principally acceler-ated tax depreciation, except forcr.rtain basis differences ansmg Net amortfzation and deferral n W1 prior to 1982. Deferred income tax provisions are included in Net periodic pension cost 5 9+43 mcome currently with corresponding credits or charges to accu-mutated deferred income taxes. Irwestment tax credits are generally deferred and amortized n e following table sets forth the funded status of the plan, as over the usefullives of the respective assets. The Tax Reform Act of detemuned by a n independent actuary, at December 31,1987: 1986(the Tax Act) eliminated thegeneration of any significant amount of imestment tax credits subsequent to December 31, Year Ended December 31, 1 %., 1985, except for credits relating to certain "transition property". in December 1987, the FASB issued Statement No. %, "Ac-counting for income Taxes", effective for fiscal years beginning Actuarial P esent Value of Benefit Obligations: vested tnnefit obligation $142.5m after December 15,1988. This Statement requires the use of the Norwested benefit obligation 7.%4 "liability method" whereby a current or noncurrent deferred tax Accumulated benefit obligation 150.173 liability or asset would be recognized for deferred tax con" Projected benefit obligation 184 353 quences of all temporary differences. Temporary differences m.- Plan assets at Iair value 167.4s7 clude all existing differences that will result in taxable or ded uctible Plan assets less than projected benefit obligation (17,366) amounts in future years. Specifically, this Statement (1) requires Unrecognized net transition liatnhty 21,x12 that a deferred tax liability or asset be adjusted for the effect of a Unrecognized net gain m change in tax law or rates, (2) prohibits net-of-tax accoun ting and Pension asset Oiatnlity)lidued Balance Sheets reporting, and (3) requires recognition of a deferred tax liability for recognized in Conso 5 (1 Al3) tax benefits that are flowed through to customers when temporary differences originate and for the equity component of AFC. De The accumulated benefit obligation is based on the plan's Company must apply Statement No. % no later than January benefit formulas without considering expected future salary in-1989 and does not anticipate a significant impact on net income. creases. De projected benefit obligation considers future salary The balance sheet will require certain reclassifications to comply increases, at an assumed annual rate of 5.51 Both benefit obliga-with the provisions of this Statement. tions were determined using an annual discount rate of 8.01 (See Note 2 - Rate Matters and Management's Discussion The expected long-term rate of retum on plan assets (primarily and Analysis of FinancialCondition and Results of Operation equity securities and govemment bonds) and discount rate used forafurtherdiscussionof theeffectsof theTax Act.) in determining pension cost for 1987 were 8.0% and 7.5%, respectively. The unrecognized net transition liability represents the effect of adopting Statement No. 87. Such obligation (approximately
P W $23.9 million at January 1,1987), was calculated by taking the lion at July 1,1987) associated with 400 MW of electric generating difference betwren the fJr value of plan assets and the projected capacity previously remowd by the PSC in its order dated March 2, benefit obligation. His liability is not recognized in the Compa-1981. The 1987 order also approved SCE&G's proposal to include in ny's consolidated financial statements, but is being amortized as a rate base the associated accumulated deferred carrying costs (ap-component of pension cost on a straight-line basis over the aver-proximately $42.5 million at July 1,1987) and to begin amortizing ge remaining service period (19.6 years) of employees expected to these costs owr a ten-year period commencing July 1,1987 (see receive benefits under the plan, except for approximately $7.5 Note IE). The July 1,1987 PSC order has been appealed by the million of prior service costs being amortized over a six-year pe-Consumer Advocate of South Carolina.While the outcome of this riod. The unamortized liability was $21.8 miUion at December 31, matter is uncertain, the Company believes the probability of any 1987. significant change in the rate order is unlikely and accoraingly, - Based on the application of accounting principles in exist-has not recorded any prmision for refunds. ence prior to the adoption of Statement No. 87, estimated accumu-B. On January 15,1987, the PSC directed SCE&G to reduce its lated plan benefits, as determined by an independent actuary, retail electric rates appruumately $25 million annually, or 3%, due and actual plan net assets at January 1,1986, were as follows: to anticipated income tax sasings associated with the Tax Act as reported in SCE&G's sNdy based on the results of operations for the year ended December 31,1985. Rates implementing this reduc-I'""' tion were placed in effect with the first billing cycle in February g I987* ' Actuarial present value of crcumulated plan benefits: On July 15,1987, the PSC issued an order which required a Vested 5 80,253 hearing to be held on Nowmber 10,1987 to receive esidence on Nomested 7,3M whether SCE&G's electric retail rates could be lowered as a result of Retirees (Prior to june 1983) 45,473 MMMMMMun On Deceh30,1987, Total 5133.090 the PSC ordered a reduction, effective January 1,1988, of $27.6 Net assets available for benefits $G4.947 million annually, or 3.7%. This reduction was primarily due to the additional tax savings resulting from the Tax Act and a change in ne assumed rate of retum used in deternuning the actuarial the method of recovery of municipal franchise taxes. Le order set present value of accumulated plan benefits was 7%; except for the retum on common ecuity at 13.25%. assets dedicated to fund benefits for Retirees prior toJune 1983 C. On January 11,1988, the South Carolina Supreme Court which are valued at 11%. denied the State Consumer Adwcate's appeal of approximately $34 in addition to pension benefits, the Company provides cer-million of the March 2,1984 order of the PSC granting SCE&G tain health care and life insurance benefits to active and retired approximately $132.6 million annually in increased retail electric i j cmployees. Such benefits are generally charged to expense when rates. claims and premiums are paid. The costs of providing such bene-D. On December 1,1987, the PSC issued an order granting fits to retired employees are not sigmficant. SCE&G appanimately $4.3 million of the $6.7 million annual i. increase in retail natural gas rates requested in an application J. Revenue Recogn. tion filed on June 5,1987. De order approved an allowed retum on Customers' meters are read and bills are rendered on a common equity of 12.75%. The new rates, which will provide an monthly cycle basis. Base revenue is recorded during the account-increase of approximately 3.8% in annual retail natural gas reve-ing period in which the meters are read. nues, were placed into effect December 1,1987. Revenue attribu table to gas costs (to the extent collectible E. In an order dated July 31,1987, the FERC affirmed an through adjustment dauses)is accrued and recorded in the month Administrative law Judge's decision relating to GENCO's filing of l during which the customers' meters are read. a cost of senice formula rate for the sale of power and energy to Projected fuel costs for electric generation are m lected SCE&G, with certain modifications to the appropriate rate of re-through the fuel component in retail electric rates, as established tum. As a result of this order, GENCO has filed a revised rate by the PSC during semiannual fuel cost hearings. Asiy differ-schedule reflecting the effects of this decision and has requested a l l ences between actual and projected fuel costs are de 3 erred and rehearing. The FERC has granted a rehearing, but no decision has included when estimating the fuelcost component during the been rendered. The Company believes that the outcome of the next semiannual fuel cost hearing. At December 31,1987, SCE&G proceedings will not haw a significant effect on its results of l had over-collected apprmimately $1.5 million throagh the electric operations. l fuel clau se component, which is induded in "Deferred Credits - F. On December 22,1987, the PSC issued an order granting i Other". SCE&G an increase in its transit rates in both Columbia and Charleston, South Carolina from a fare of $.25 to $.50. De new l K. Debt Premium, Discount and Expense rates were placed inta effect on January 1,1988. long-term debt premium, discount and expense are being amortized as components of "Interest on long-term debt, net" 3.f,ong. Term Debt over the terms of the respective debt issues. SCE&G's annual tender Pollution Control Facilities Revenue B nds (which do not include the 5.95% series, due 2003) are se-
~~2. Rate Afatters'.~~
cured by like principal amounts of its First and Refunding Mort-A. In an order dated July 1,1987, the PSC approwd SCE&G's gage Bonds. Janua 30,1987 request to restore to its rate base, effective July 1, 1987,t net production investment (approumately $102.5 mil-l
I \\ / 3...;.. . 1 -DO :
~~1..,~~
~~L- ..i-. .7 . ~. 7 !~.~',. GENCO's annual tender Pollution Control Facilities Revenue~~
~~6. Stockholders' Investment (Includ,ngPreferredS!ockNot Bends are secured by an irres ocable letter of credit expinng in Subject to Purchase or Sering Funds):~~
1991 These annual tender bonds bear interest at a rate, which will The changes in "Common stock", without par mlue, during be set between 80% and 120% of an index rate based on one-yea r 1987,1986 and 1983 are summarued as follows: yield evaluations of comparable tax-exempt obligations, or equal to 65% of one-year yield evaluations of U. S. Treasury Bonds at par, $mg gds but, m any case, not more than 15% per annum. The mterest rate + is adjusted annually, but may become fixed unta maturity. These Balance January 1,1985 40.2 %,147 5575,263 Other 343 Bonds also provide'that the holders may require the Bonds to be purchased a t par upon each annual adjustment of the interest rate Balance December 31,1985 40,296,147 575,606 Other (1,364) or at the time the interest rate becomes fixed until maturity. If the Bonds a re tendered by the holders, the Company intends to reof-Balance December 31,19s6 40,296,147 574,242 fer the Bonds to the public. Due to the irrtvocable letter of credit Other 258 and prmisions of the Bond Indentures, which permit the Com-Halance Decem ber 31,1987 40.2 %,147 5574.500 pany to purchase the Bonds in lieu of redemption and resell them, and to substitute other security arrangements, the Bonds are clas-The Company's employee stock benefit plans' trustee and stfied aslong-term debt. agent for its Divid'end Reinvestment and Stock Purchase Plan The annual amounts oflong term debt maturities, including the amounts due under nuclear and fossil fuel agreements (see purchase previously issued and outstanding shares of the Compa-Note 4), and sinking fund requirements for the years 1988 ny's common stock in the open market. through 1992 are summanzed as follows: The Restated Articles of Incorporation of the Company do not limit the dividends that may be payable on its common stock. Year Amount Year Amou nt However, the Restated Articles ofIncorporation of SCE&G and the crheusamf5 of Dwars) indentures underlying certain of its bond issues contain provi-1983 5 24.719 1991 517,478 sions that limit the payment of cash dividends on common stock. 1989 54.129 1992 9,442 Accordingly, $286.8 million of consolidated retained earnings 1990 180,791 were not restricted as to payment of cash dividends on common Approximately $9.2 million of the current portion of long-term stock at December 31,1987. debt for 1988 may be satisfied by either deposit and cancellation of Cash dividends on common stock were declared at an an-bonds issued upon the basis of property additions or bond retire, nual rate per share of $2.32, $2.24 and $2.16 for 1987,1986 and ment credits, or by deposit of cash with the Trustee. 1985, respectively. Substantially all utdity plant and fuelinventories are pledged as collateralin connection sith lang-term debt. S. PmferredStock(SutjedtoPurchaseorSinUngFunds):
~~4. Fue/Financ/ngs:~~
The call premium of the respective series of preferred stock in no case exceeds the amount of the a nnual dividend. Retirements Nuclear and fossil fuel imentories are financed through the issuance of short-term commercial paper. These short-term bor-under sinking fund requirements are at par values. rowings are supported by irrevocable bank lines of credit which At any time when dividends have not been paid in full or declared and set apart for payment on all series of preferred stock, expire in 1990. Accordingly, the amounts outstanding have been SCE&G may not redeem ani shares of preferred stock (unless all included in long-term debt. The bank lines provide for maximum amounts ($75 million related to nuclear fuel and $25 million re-shares of preferred stock then outstanding are redeemed) or pur-lated to fossil fuel) that may be outstanding at any time-chase or otherwise acquire for value any shares of preferred stock At December 31,1987, the amount outstanding for nuclear except in accordance with an offer made to all holders of preferred fuel was a pproximately $63.9 million at a weighted average interest stock. SCE&G may not redeem any sharcs of preferred stock (un-rate of 8.05% and the amount outstandmg for fossd fuel was less all shares of preferred stock then outstandmg are redeemed) approximately $20.1 million at a weighted average intere st. ate of or purchase or otherwise acquire for value any shares of preferred 8.11 %. stock except out of monies set aside as purchase funds or sinking funds for one or more series of preferred stock, at any time when it is in detault under the provisions of the purchase fund or sinking fund for any series of preferred stock. On May 29,1987, SCE&G's Board of Directors called for the redemption of all the issued and outstanding shares of that com-pany's 13 88% Series, $100 par value, cumulative prefernM stock. On J uly 1,1987, all 250,000 shares outstanding were redeemed at a price of 106.18%. ( l 1
I I e ne aggregate annual amounts of purchase fund or sinking Totalincome taxes differ from amounts computed by apply-fund erquirements for preferred stock for the years 1988 through ing the statutory Federalincome tax rate of 40% for 1987 and 46% 1993are summarizedas follows: for 1986 and 1985 to pre tax income as follows Year Amount Year Amount 1987 1986 1%5 fIhousands of Ddlars) (Thousands of Ddlars) 1988 $ 5,948 1991 $2,515 Netincome $128,865 $122,164 $113,560 1989 9,270 1992 2,515 Totalincome tax expense: 2,515 Charged to operatingexpenses 95,051 119,108 105,783 Charged to otherincome 195 (2,261) 5,271 'Ihe changes in Preferred Stock (Subject to Purchase or Sink-Preferred stock dividends 10,437 14,443 16.541 ing Fu nds)" during 1987,1986 and 1985 are summarized as Total pre-taxincome 5234,548 5253,454 $241,155 follows: Income taxes on above at statu-Number Thousands tory Federalincome tax rate $ 93,819 $116,589 $110,931 of Shares of Dollars increases (decreases) attributable to: Balance january l,1985 2,246,186 $156,789 in const on(e c ding Shares Redeemed: nuclear fuel) (825) (1,053) (707) $100 par value (20.550) (2,055) Deferred return on plantin-50 par value (44,408) (2,220) wstment, net of Balance December 31,1985 2,181,228 152,514 amortization (1,575) (5,727) (5,925) Shares Redeemed: Depreciation differences 620 5,309 5,325 $100 par value (343,070) (34,307) Amortization ofinvestment tax 50 parvalue (13,300) (665) credits (5,410) (8,107) (6,065) Balance December 31,19% 1,824,858 117,542 c me axeHect) ,930 8,220 7,503 Shcres Redeemed: emnces, nel 1,616 (8) 5100 par value (263,994) (26,399) 50 par value (130,2111 (6,51D Totalincome tax expense 5 95,246 $116,M7 $111,054 i Balance December 31,1987 1,430,653 5 &4,632 ' Total provision for deferred taxes, net" results from timing differences in recognition of the fouowing items: 7j ( l 1987 1986 1985 Total income tax expense for 1987,1986 and 1985 is as follows: 1987 1986 1985 Charged toenpenses: f (ThousandsofDdlars} Accelerated depreciation and amortiration 531,543 $40,367 546,084 Currentincome taxes: Deferred fuelrevenue (2,041) (4,616) (801) f4dera! 56(,850 $ 82,637 5 57,680 Other, net (8,875) (2,116) (2,786) State 10,117 9,845 8.687 Fowign (177) 674 Total provision for deferred inc me tases, net 520,627 533,635 542,497 Totalcurrent tases 76.%7 92,305 67,041 Deferred taxes, net: Federal 16,361 28,257 37,289 The Internal Revenue Service has examined the consolidated State 4,266 5,378 5,208 Federalincome tax returns of the Company through 19M and has Totaldeferred tases 20,627 33,635 42,497 closed all years through 1980. A final report has been received for j 1981 and all issues resohrd. In addition, a final report for 1982 Investment tax credits: Deferred 2,821 (1,486) 6,887 through 19M has been received and allissues resolved, except those pertaining to the deductibility of certain nuclear liability j Amortizatwn of amounts deferred (credit) (5,410) (8.107) (6,065) insurance premiums. The Company does not anticipate any sig-j Other 241 500 694 nificant effect onits results of o ation or financialposition i Totalinvestment tas credits t 2348) (9,093) 1,516 resulting from the resolution o these issues. At December 31,1987, the cumulative net amount ofincome ( Totalincome tax espense 593 246 5116,847 5111,61 tax timing differences on which deferred taxes have not bwn provided totaled approximately $95 million. (See Note 1H.) i
g i B. Staf-TermBorrow/ngs: B. NuclearInsurance ne Company pays fees to banks as compensation for its ne Price-Anderson indemnification Act (the Act) which lines of credit. Bank loans are for 270 days or less. Details of lines deals with SCE&G's public liability for a nudear incident, expired of credit and short-term borrowings at December 31,198,1986 and 1985 and for the years then ended are as follows: on August 1,1987. In late July 1987, Congress extended the pro-tection provided by the Act until new legislation is passed. The ~ Act currently limits the liability for third-party claims to $720 mil-Decen&r 31. lion per incident. He Act provides that all owners of nudear 1957 1986 1985 reactors may be liable for up to $5 million per reactor owned for OdId'8'" *l""d each nudear incident occurring at any reactor in the United States with a limit of two assessments per year (a retroactive pre-Lines of credit at year end 5 90.2 $133.2 $87.9 mium). SCE&G's maximum assessment, based on its two-thirds Short-term borrowings rinduding ownership of Summer Station, would be approumately $6.7 mil-commercial paper)dunng the year: lion per year. { Maximum outstanding 1133.1 $111.2 $ 4.5 Proposed legista tion is currently pending in the House of \\, Average outstanding 5 39.1 $ 45.7 5 1.1 Weighted daily avera p interest rates: Representatims and Senate. One proposed wrsion would raise the liability limit for third-party claims associated with any nudear Creditlines 7.07% 7.40 % 8.53 % incident to $7 bdlion. Under this proposal, each reactor licensee Commercialpaper 6.65 % 6.36 % may be liable for up to $63 million per reactor owmed for each Short-term borrowmgs ertanding at nudear incident occurring at any reactor in the United States, r es 5 2.25 $ 2.25 $ 2.25 provided that not more than $10 million of this liability would be Weighted averageinterest rate 8.76 % 6.25 % 8.57 % assessed per year. SCE&G's maumum assessment, based on its Commercial paper 5 19.2 5 78.2 two-thirds ownership of Summer Station, would be approumatel Weighted average interest rate 8.30T 6.67 % S12 million per incident, but not more than $6.7 million per year y t SCE&G is unable to predict what action Congress might ultimately i
~~9. CommitmentsandContingencies:~~
take regarding the Act and what effect such action might have on scggc., potent;,115,yggity. A, tem SCE&G currently maintains r les with Nudear ElectricIn-SCE&G leases certain equipment, office fumiture and an surance Limited (NEIL)and Arr .an NudearInsurers(ANI) office building under long-term operating leases with lease terms providing combined property ai.J decontamination insurance (exduding various renewal options) expinng in 1996,1991 and cowrage of $895 million for any losses in excess of $500 million 2009, respectively. pursuant to existing primary cowrages (with ANI) on Summer s ( Total rent expense was approumately $5.1 million, S4.4 mil-Station. SCE&G pays annual premiums and, in addition, could ) lion, and $5.0 million for 1987,1986 and 1985, respectively-be assessed a retroactive premium not to exceed 7% times its an-Future mirumum rental payments as of December 31,1987 are nual p emium, in the ewnt of property damage loss to any nu-g as fouows: dear generating facilities covered by NEIL. Based on the current annual premium, this retroactive premium would be approxi-mately $5.3 million. Year Amount Year Amount To the extent that insurable claims for property damage, decon-(Thousan.fs of Dd!ars) tamination, repair and replacement and other costs and ex-I penses arising from a nuclear incident at Summer Station would '9 exceed the policy limits of insurance, or to the extent such insur-1990 7,124 1993-2009 112"320 ance becomes unavailable in the future, and to the extent that SCE&G's rates would not recover the cost of any purchased re-placement power, SCE&G will retain the risk of loss as a self-insurer. SCE&G has no reason to anticipate a serious nudear incident at Summer Station. If such an incident were to occur, it could have a materially adverse impact on the Company's financial position. - ~ - - - ~ ~
L. .i ~.'.. '.. T ~ 1986
~~10. SegmentolBusinessinfomution:~~
Electric Gas Transit Total Segrnent information at December 31,1987,1986 and 1985 (Thowndsof Do&rs) and for the years then ended is as follows: Operating revenues 5 8 M,4S8 5289,429 5 3.119 $1,102,036 39g OWrating espews, Ilectric Gas Transit Total escludmg depreciation flhousands of Dollars) and amortization 544,067 261,712 6,914 812,693 Operating revenues $ 506,826 $305,934 $ 3.212 $1,115,972 Depreciation and amortuation 80,825 9,557 245 90,627 Operat.mg espenses, Totaloperating espenses 624.892 271,269 7,159 903,320 excludingdepreciation and amortization 539,604 271,644 7,756 819,004 Operatingincome 00ss) $ 1M,5% $ 18,160 $(4,040) 198,716 9,825 Depredation and amortization 82,58 9,519 306 92,%3 Add - Otherireme, net
~~'[I" prefe 5 k dividends 3~~
Total operating es penses 622,362 231,163 8,062 911,587 $ 122,164 Operating income doss) $ 184,4t4 5 24,771 $u,850) 204,385 Net income 6,395 Add - Other income, net Capital espenditures: Identifiable $ 110,249 $ 20,981 $ 247 $ 131,47 - P fer ds k dividends 1 7 12,700 Utilized for overall Company operations ~$ 144,177 $ 128,565 Net income Total Ca pital cipenditu res: Identifiable $ 146,281 $ 21,034 $ 333 $ 167,643 ldentifiable assets at December 31,1956: Utilized for oserall Companv operations Utthty plant, net $1,988,769 $214,299 $1,U8 $2,204,846 5,670 $ 173,318 Inventones 62,930 6,845 320 70,W5 Total Total $2,051.699 $221,144 $ 2,W8 2,274.941 1dentifiable asscts at W'M W' Lit lar t, net $2,039,752 $225,503 $ 1,783 $2,267,038 $2,575,332 Inventories 74,977 6,859 374 82,2,10 Total assets Total $2.I14.729 $232,362 $ 2,157 2,349,24% gg3 353,121 EkTtric Gas Transit Total Assets utilized for userall Company operations $2,702,369 (ww,,dsof n&rs) Total assets Operatmg revenues 5 787,796 $318,8% $ 3,M9 $1,110,341 j Operating espenses, escludmg depreciation and amortization 528,773 239,868 7,203 825,M4 1 j Depreciation and amorttzation 77,658 9,033 208 86.899 l Total operating espenses 606,431 N8,901 7,411 912,743 Operatingincome doss) $ 181,365 $ 19,955 $(3,722) 197,598 1 15,721 ( Add - Otherineme, net 83,218 / Los - Interest charges - Preferred stock onidends 16,541 $ 113.560 Net income Capitalespenditures: Identiftable $ 97,525 $ 24,091 5 609 $ 122,225 { 6,2*i2 Utihied for overall Company operations $ 128.507 Total Identifiable assets at twember 31,1985: Utihty plant, net $1,9M,372 $203.060 $ 2.159 $2,193,591 f Inwntones 51,3 % 7,337 298 58,991 Total $2,039,723 $210,397 $ 2,457 2,252,582 \\ 291.117 Assets utthred for overall Company operatons $2,543,699 Total assets
p_ , c. r 3 . :n.
~~11. QuarterlyFinancialData(Unaudied):~~
1987 Fiist Second Third fourth Quarter Quarter Quarter Quarter Annual Total 6, nating revenues 1000) $309,294 $258,146 5296,061 5252,471 51,115,972 Operating Income 10001 57,007 42,978 68,039 36, % 1 204,385 Net incorne (000) 40,9'8 23.873 47,537 16,477 128,865 Eamings per share of common stod ae reportcJ 1.02 .59 1.18 .41 3.20 IW6 Ftrst Sectmd Third Fourth Quarter Quarter Quarter Quarter Annual Totaltperating revenues (000) $301,445 $247,363 $239,857 $263,371 $1,102.0% Operating income (000) 56,010 40,546 62,920 39,240 198,716 Net incorne 90) 34,343 23,922 41,942 21,957 122.164 Earnings per share of cornmon stod as reported .85 .59 1.04 .55 3.03 .comuou srbox useoaus rnon 1987 1986 4th 3rd 2nd 1st 4th 3rd 2nd 1st Qtr. Otr. Qtr. Otr. Qtr. Qtr. Qtr. Qtr. Price Range:(a) liigh 33 %1/2 35-Ud 40 39-7/8 42-7/8 36-3/4 33-1/4 Low 26-1/2 30-5'8 30-7/8 M-3 8 36 klO 31-1/4 271/8 Dividends Per Share: 1987 Amount Date Declared Date Paid f irst Quarter 5.58 January 23,1987 Aprill,1987 j Second Quarter ,58 April 22,1987 July 1,1987 l 1hird Quarter .58 August 26,1987 October 1,1987 Fourth Quarter .58 October 28,1987 January 1,1958 1986 Amount Date Declared Date Paid First Quarter 5.56 January 22,1986 Apnl 1,1986 Semnd Quarter .56 Apn123,1986 July 1,1986 Third Quarter .56 July 23,1986 October 1,1986 Fourth Quarter .56 Odober 22,1986 January 1,1987 December 31, 1987 19S6 Numberof common shares outstanding 40,29e,147 40,296,147 Number of common stockholders of record 49,932 51,738 The principal market for SCANA common stock is the New York Stock Exchange (stock symbol-SCG). (a) As reported on the New York Stock Exchange Composite Listing.
M h N 'A G t M E N T 'S ~ 01 S C 'U $ *SQ N, h H A L Y S I S 0 0 Fl ^ ; l ' :,9 F I N A N, C I A L CONDifjOn & $t W LTp QF;QfE4f710Nf UquidityAndCapita/ Resources tions, regulation and legislation, rates of load growth, emiron-mer tal protection standards and the cost and availability of ne capital needs of the Company arise primarily from the cdp"dl-capital requirements of SCE&G's operations and construction SCE&G presently has in effect a shelf registration statement program. Because rates for regulated senices are based on histori. under which it can issue an additional $100 million of First and cal cost amounts, to the extent inflation occurs and rates are not Refunding Mortgage Bonds. Whether additional securities wiU ie appropriately adjusted on a timely basis, the Company's regulated sold and the timing and amount of such sales will depend pnm-subsidiaries may not recmyr all costs of providing seriices. There. ily upon market conditions and other factors. fore, the Company's future financial ition and results of opera. Forinformation relatingtooperations of theComparr sub-tions could be tm acted by future inf t onary trends. sidiaries see pages 8 through 25. he abihty o the Cor' pany's regulated subsidiaries to replace n existing plant imestment, as well as to expand to meet future 80Sults Of 0 "8tions P demand, will depend upon its atiility to attract the necessary financial capital on reasonable terms. he ability to attract such Earnings and Dividends Eamings per share of common stock, the percent icrease capital will, in turn, depend upon the regulated subsidiaries' abtl-(decrease) from the previou, year and the rate of retur. eamed on ity to obtain adequate and timely rate rehef. common equity for the years 19S5 through 1987 were a 'ouows: During 1987, the PSC issued orders requinng SCE&G to re-duce its retail ekctric rates to reflect income tax savings associated m, 19 % 1985 with the Tax Act (see Note 2B of Notes to Consolidated Financial Earnings per share suo 53.03 52.82 Statements). The tax savings result from a reduction in the Federal Percent increase (decrease)in corporate income tax rate from 46% to M%, ef fective J uly 1,1987. carnings per share 5.6% 7.4 % (7.5% ) Retum earned on common Because the Company is fuuy normalized with respect to invest. N"WY'-end) 14 ss 14 6% 14.1% ment tax credit and tn depreciation, the Company does not anticipate a significa nt of fect on its results of operations or fina n-Earnings per share increased from 1986 primanly as a result of cial position, but intemal cash flow will be reduced in future years higher sales of electric energy and natural gas and a reduction in pnmarily due to the repeal of the imestment tax credit retroactne preferred stock dividends associated with early redemptions of to January 1,1986, and the lengthening of depreciable lives for preferred stock issues (see Note 6 of Notes to Consolidated Finan-certain utility property. The impact of this reduction will dqend cial Statements). The increase in camings per share for 1986 re-upon the lewl of construction expenditures in future y ears. In sulted primanly f rom higher electnc energy sales rebted to the 1986 addition, the inclusion of unbilled revenues and contributions summer heat wave, lower interest charges 'and reduced dividend in aid of construction in current taxable income, the treatment of requirements on preferred stock. certain expenses w hich now must be capitahied for tax purposes AFC is a utility accounting practice w hereby a portion of the and other provisions in the Tn Act could further restrict cash flow cost of both equity'and borrowed funds used to' finance constmc-in 1988 and subwquent yeats. tion (w hich is shown on the balance sheet as construction work Continued growth in the Company's nonutihty operations, in progress)is capitalized. Both the equity and the debt portions of along with future economic expansion throughout the utthty ser-AFC, are noncash items of nonoperating income w hich have the vice temtory, could have a positwe impact on total Lompany ef fect of increasing reported net income. AFC represented ap-proximately 3% of Eamings Available for Common Stock in 1987, camings. The pnmary cash requirements for 1987 were, and as esti-1956 and 1985. mated for 1988 are, as follows: Dunng the penod Starch 19M through June 1987, the Com-pany recorded carrying costs (including equity return) associated 19ss m (T h e etL W s) with the production investment, net of accumulated ciepreciation, Construction e nditures. excluding relatin g to 40051W of electric generating capaaty removed from ratMw Total deferred carrytng costs. a noncash item included tn (A $172,677 5142,W under "Other income ' as "Deferred retum on plant tm estment . uclear fuelespenditures 10,931 27,122 represent approximately 5%,10% and 11% of Eamings Available i Matunng ot+gations. redemptions and for Common Stock for the years 1987,1986 and 1985, respectively. sinking and purchase fund l 21w w4 m2 Commenang J uly 1,1987, the Company ceased deferring carry requirements ing costs and beg'an amortizing the accumulated deferred carry-g Total 5205 074 52'4 At ing costs owr a ten-year period. (See Notes 1E and 2A of Notes to During 1987, approximately 56.6"< of total cash requirements Consohdated Finan'cial Statements.) were prouded from intemal sources e compared to 57.34 m in Ftbruary 1988, the Compam's Board of Directors raised the ~ 1986. Extemal funds for 1987 were prouded through the issuance qua rterly cash Jiividend on common stock to 60 cents per share f rom 58 ' ents per share. The increase, ef fwtur with the dividend of $100 muhon pnnapal amount of First and Refunding hiort-c gage Bonds, S-3/4% Senes due february 1,2017, the sale of %h. payable on Apnl 1,1958, raised the indicated annual d:vidend mdlion in tax-exempt annual tender Pollut on Control faahties ,4 to 52 40 per share, up from $2.32. The Company hasincreased Revenue Bonds due 2014 and a MO milhon Pank Note due 1989 the dividend rate on its common stock in 35 of the la'st 36 years. The Company antiapates that 1958 cash requirements will be met pnmanly through intemally generated funds, short-term bor-rowings and the sale of commerctal paper. Actual 1988 constme-tioa and nuclear fuel openditures may vary from the estimates set forth above due to f actors such as intlatmn and economic condi-
~ .n i Operating htargins The increases in gas operating margins are primarily the re-Electric operating margins for 1987,1986 and 1985 were as sult ofincreases in customers and decatherm (DT) sales of natural follows: gas as presented in the following table: 1987 1% 1985 Increase (Decrease)From Prior Year (Afdhens of D@rs) Customers Volume (DT) Electricoperatin rewnues $806.8 5809.5 5787.8 Classihcation 1997 1986 1987 1% r rtha nft Residential 1,791 1,442 1,4,66,477 487,447 ( ) -) Commeraal 556 532 ,68,576 .07,888 Total 5591.4 5596.2 5567.4 Industrial 12 (35) 2,060,800 (2,353,490) Sale for resale 8 1,910,5 M 4.124,761 The 1987 operating margin remained relatively unchanged Total 2.397 1,939 6.226.4 ta 2,466,606 from 1986 because sales associated with increased kilowatt-hour consumption were offset by reduced retail e'ectric rates placed in The increase in Gas purchased for resale in 1987 reflects in-effect in February 1987. (See Note 2B of Notes to Consolidated creased customer demand for natural gas. The decrease for 1986 Financial Statemems.) The increase in the 1986 operating margin reflects reductions in the cost of gas purchased from the Compa-esulted primarily from increased kilowatt-hour consumption by ny's suppliers. resides.tial and commercial customers. Such increase was largely due to the addition of residen tial (3.1 % ) and commercial (4.4 % ) Other Operating Expenses customers. Increases (decreases) m.other operating expenses, including Increases (decreases)in electne customers and megawatt-taws, are presented in the following table: hour (htWH) sales wlume by classes of customers are presented in increase (Decrease) the following table From Pnor Year Classification Increase (Decrease)From Pnor Year 1987 1986 Customers Volume (MWH) g Other operation and maintenance $ 14.9 58.6 Classihcation 19A7 IW 1%7 1% Deprecatien and amortuation 2.0 3.7 Residential 8,936 10,584 181.540 434.464 Incoma tases (24.11 13.3 Commercial 2,296 2,092 184,359 233,748 Other tases 6.9 2.9 Industrial 02) (17) 166,217 31,W Total 5 L3) 528.5 Sale for resale (1) 50.524 (59,668) Other 67 43 7,on 22.765 [ Total n,267 12,701 609.e7s 663.245 Other operation and maintenance expenses for 1987 in-creased pnmarily because of additional operating expenses for The increase in Fuel used in electric genera tion expense for outside professional services relating to the refueling at Summer 1987 was due primarily to additional fossil fuel requirements (at Station. The increase in 1986 was largely due to the settlement of unit costs higher than nuclear generation) associated with in. certain claims relating to injuries and damages and moderate creased electric generation resulting from an owrall increase in increases in other administrative and general expenses. Increases customer demand and the scheduled refueling of V. C. Summer in Depreciation and amortization expense for 1987 and 1936 re-Nuclear Station from htarch 6 through June 7,1987. The decrease flect additions to plant in service and the amortization of deferred for 1986 was primarily attnbutable to a reduction in the average cost carrying costs beginning July 1,1987 (see Note 1 E of Notes to of fuel bumed ($1.45 and $1.63 per million BTU in 1986 and 1985, Consolidated Financial Statements). The increase for 1987 was respectiwlv), primarily attnbutable to nuclear fuel. Power pur. partially offset by the effect of lower electric depreciation rates be-chased, net decreased for 1987 largely due to greater demand for ginrung July 1,1987. The decrease in Income tax ex pense for 1987 electricity by other utilities and increased for 1986 primarily be. results primanly from a reduction in the Ederal corporate incorr e cause of lower demand for electricity by other utihties. tax rate effective July 1,1987and lower pre-tax income resulting As a result of unusually hot weather and an increase in the from a reduction in retail electric rates. The increase in 1986 was number of electric customers, the Cc,mpany set a series of peak largely due to an increase in pre-tax income. Increases in Other demand records during the summer of 1987, with the highest peak taxes for 1987 and 1986 primanly reflect additional property taxes. of 2,943 htW cecurnng on August 10,1987 the previous year's record of 2,853 hfW having been set on July 9,1986. Interest Charges Gas operating margins for 1987,1986 and 1985 were as Interest on long-term debt decreased $.1 million in 1987 and goijow3 $15.6 mdlion in 1986 compared to the respective previous years. The decreases in 1987and 1986 resulted from the early redemption 1"7 19so 1985 of $60 million principal amount of the 151/2% Guaranteed Notes f.wums of D*5) of South Carolma Electric & Gas Finance, N.V. in Apnl 1986. The Gas operating rewnues $ho 5289 4 5318.9 decrease for 1987 was offset by interest associated with theissuance Less Gas purchased for resale 222.3 215 9 246 8 of $100 million pnnapalamount of 8-14% Series First and Re-Total 5 n7 5735 5 72.1 funding htortgage Bonds in February 1987. Othe r interest expense decreased 5 6 million in 1987 and increased $4.0 milhon in 1986 compared to the respectiw presious yea rs. These changes reflect the decrease and increase, respec-tiwly, in short term borrowmgs from the previous year. )
l
~~SELE 0TED $ i N A N C I.A L.~~
OATA' 1987 1986 1985 19M 1983 1982 1977 For theYears Ended December 31, fThusends of Ddlars except statistics and pi share amounts) Statement ofIncome Data $ 806,826 $ 809,488 $ 787,796 5 746,745 $634,127 $574,113 $M4,9M OperatingRewnues: 305,934 289,429 318,856 378,491 337,282 266,389 78,405 Ekctnc 3,212 3,119 3,689 3,178 3.242 2,603 2,023 Gas Transit 1,115,972 1,102,036 1,110,341 1,128,414 974,651 843,105 425,392 TotalOperatingRevenues 227,877 216,0~6 229,249 223,768 260,381 214,617 155,132 OperatingExpenses: 222,319 215,928 246,7f0 289,212 277,(81 220,502 51,321 Fuelusedin electric generation Gas purchased for resale 214,865 209,629 195,031 187,448 135,374 147,M0 50.144 92,533 90,627 86,899 74,914 45,000 43,406 30,339 Other operation and maintenance 153,943 171,000 1 54,8 &l 153,776 106,932 77,033 66,684 Depreciation and amortization Taxes 911,587 903,320 912,743 929,118 824,778 703.398 353,620 TotalOperating Expen:,es 204,333 198,716 197,598 199,296 149,873 119,707 71,772 OperatingIncome 6,395 9,825 15,721 17,M7 11,571 5,230 25,566 TotalOtherincome Income BeforeInterest Charges and Preferred Stock Dwidends 210,750 208,541 213,319 216,943 161,444 144,937 97,338 71,478 71,934 83,218 78,243 57,506 57,121 39,003 lotalInternt Charges, Net Preferred Stak Cash Dwidends of 10,437 14,443 16,541 16,8'7 17,186 16,371 10,653 Subsidiary $ 128,865 5 122,lM $ 113,5N) $ 121,818 $ 86,752 5 71,445 $ 47,682 Netincome Common Shares Outstanding (Thousands) 40,296 40,295 40,296 39,900 37,M4 34,387 19,S33 $3.20 $103 $2.82 $105 $2.29 $2.08 $2.40 Earnings Per Share of CommonStock Dnidends DedanM PerShare of Common $2.32 $2.24 $2.16 $2.05 $2.00 $1.92 $1.56 Stock Pertrnt of Operatingincome(loss) s 91 93 92 87 93 98 94 ( IkforeincomeTaxes: 12 9 10 15 10 5 8 Electnc 01 (2) (2) (2) (3) (3) (2) Gas Transit
I c December 31, 1987 1986 1985 19M 1983 1982 1977 t Balance Sheet Data (Thousands of Ddlars excryt statistics and per slurr arnou n ts) Gross Utility Plant $3,099,660 $2,959,494 $2,859,117 $2,7M,809 52,509,581 $2,411,479 51,489,111 Total Assets $2J02,369 $2,575,332 $2 M3,699 52,499,694 $2,358,1M $2,N2 755 $1,361,222 Common Equity 5 871,620 $ 836,913 $ 806,155 5 778,251 $ "'09,908 5 659,135 5 ',66,813 Preferred Stock Subject to Purchase e or Sinking Fund Requirements 84,632 ll7,M2 152,514 156,789 160,6N 163,619 109,794 Preferred Stock Not Su bject to Purchase orSinkingFundFx uireiiia.'s 26,029 26,029 26,262 26,262 26,262 26,262 26,262 o Long-Term T%t, Net SS6,993 745,451 785,021 893,950 789,216 854,844 585,307 TotalCeptalization 51.S69,274 $1,725,935 51,769,952 51,855,252 51,685,990 $1,703,860 $1,088,176 s l$ il Comrin Shares Outstanding (Year-I:ad)(Thousands) 40,296 40,296 40,296 40,296 38,728 36,526 20,359 IkokValut PerShareof j Common Stock (Ye=r End) 521.63 520.77 $20.01 $19.31 $18.33 518.05 $18.02 i Other Statistic s Electric-Custome s(Year 3nd) 417,778 406,511 393,810 378,960 36G,424 356,709 320,476 Sales (Mi bon KYJH) 14,314 13,7N 13,N1 12,590 12,063 11,490 11,155 Resident,al: Awragt annual use per custe.aer(KWH) 12,955 12,821 11,992 12,061 12,009 11,712 12,146 p Averageannual rate j per KWH 5.0724 $.0759 $0774 $.0757 5.0612 $.0637 5.N12 Generating Capabihty-Net MW O' ear-End) 3,S90 3,890 3,959 3,959 3,359 3,359 2,852 Terntori=! Ped Wmand - Net MW 2,443 2.853 2,703 2,5% 2,700 2,463 2,216 Gas: ) Customers (Year-End) 195,335 192,941 191,002 189,M4 137,638 186.320 161,850 i, Sales (Thousand lherms) 734,145 671,SSI M7,215 737,059 671,429 590,257 468,786 Residential. Average annual use per 'a customer (therms) 627 MS 524 618 610 570 7M y Average annual rate per therm 5.68 5 68 5.67 5 69 5 65 5.56 5 26 Transit: I Number of Coaches los 117 122 123 112 IN I Revenue Ibssengers Carned(Thousands) 8,668 8.699 9,032 9 658 9.744 10,720 8.9 71 l I '\\ i
F v Corporate Headquarters Stockholder inquiries Bond Trustee and Paying Agent IblmettoCenter Questionsconcerningdividend SCE6C Firstand RefundingMertgage accounts or related stockholder matters &mds: 1426 Main Street shouldbe directedinwritingtothe ManufacturersHanowrTmst Columbia, SC Telephone:(803)7483000 Stockholder Records Dtyartment (034) Company ms Pfs @gah. a u Mailin Address SCANkCorporation Auditors New York, NY 10020 Columbia, SC 29218 Deloitte Haskins & Sells Certified Public Accountants Investor Conununications Interim re rts providin pdated Common and Preferred Stock Listm.gs 1426 MainStreet, Suite 820 financiali ormationankompany ThecommonstockofSCANACorpora-Columbb,SC29201 g tienislisted and traded on the New York Stock Exchange. The ticker symbol Recordkeeping and Paying Agents the ot f t, second an is SCG.The corporate name SCA'NAis Comnum Std cruarters. Acopyof SCANA's Annual usedin newspaper stocklistings. SCANACorporation RePoit on Fonn 10-K(as filed with the The 5% series cunatlative preferred stock Stockholder Records Department (054) Secun. ties and Exchange Commission) of SCE&Gis alsolisted and traded on Columbia, SC29218 and the Statistical Supplement to the 1987 AnnualReportareavailable to theNewYorkStockExchan8 'The SCE6C PnferredStxk: stockholders and others withwt charge ticker bolis SAC Pr,the "PP SouthCarolina NationalBank listinS shCrE f-SecuritiesTransferSenices Inquiriesconcemingactivitiesof i P Dividend Payment Dates 101Greystone Boulevard SCANACorporation and requests for Quarterlydividends oncommonstock Columbia, SC 29226 publications should be addressed to the inwstor Relations Department (051) at are normally payable on the first day of Transfer Agents the Company's maihngaddress. Jan Apn!,fulyand October to thC lina NationalBank Anal 's Contact gt$pa SmintiesTrantfa Sm' ices H.Jo %mn, HI t month r Manager-Inwstor Relations date 101 GreystoneBoulevard Telephone:(803)748-3240 Dividends on SCE&G's preferred stock Columbia, SC 29226 are paid quarterly on the same dates as Manufacturers HanowrTmst Imystors' Association the common stock dividends. herDepartm nt 8thFkior n ct t wn e to of Dividend Reimestment Plan St SCANAoffersa Dividend Reinwst-450 West 33rd Street SCANAInwstors, clo Mr. Paul S mentandStockPurchase Plan toits New York, NY 10001 Quattlebr**.63FastBaY treet' common stockholders of record. A bro-Charlesto. .'.29401 chure, Authorization Form and retum SCE6C Preferm1Std SouthCarolina NationalBank enwlope are automatically mailed to all SmiritiesTransferSmices new stockholders. For further infonna. 101Greystone Boulevard NwawWWmW dy-tion or for questions about your rein. Columbia,SC29226 mma ef a m,,,73,,,y wstment account, write to the Stock. holder Records Department (054) at the The Chase Manhattan Bank, N.A. pucased wrysvo'awvverse Ayuset,ry Company's maihng address. StockTransfer De ent seewees PO. Bax 469, Was gron Bridge Station New York, NY 10033 s
I - SCANA CORPORATION Columbia, South Carolina 29218 ' a [ B E-s 1 ^ E = [ E R 5 m _EE E E W E N -}}

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