Chairman Whitfield, Ranking Member Rush, and members of the Subcommittee, my name is Lonnie Carter and I am the President and Chief Executive Officer of Santee Cooper, the South Carolina Public Service Authority. While I am currently serving as Chairman of the Board of Directors for the American Public Power Association, my comments and presence here today solely represent those of Santee Cooper.

Santee Cooper has been a resource for improving the health, welfare and material success of the residents of South Carolina. Santee Cooper is guided by our mission of improving the quality of life for the people of South Carolina by providing low-cost and reliable power and water to our customers while being good environmental stewards.

As South Carolina's state-owned electric and water utility, we serve about 2 million customers directly and indirectly. We are accountable for keeping electricity affordable and the lights on.

Our industry is at a time of unprecedented change and challenge, the likes of which I've not seen in my 28 years in the industry, bringing with it uncertainty and higher costs to customers. I am very concerned about the many proposed EPA regulations and what they could mean in the short and long term. As a public power entity, we have no shareholders to share the cost of regulations. We are literally where the rubber meets the road.

We are the state's leader in renewable energy, with 197 megawatts of renewable generation already online or under contract. They are voluntary business decisions that successfully balance low cost, reliability and care for the environment.

Santee Cooper has been a leader in installing environmental control technology and, in fact, already reduces NOx by over 90 percent and SO2 by as much as 98 percent through SCRs and scrubbing at our generation stations.

We launched a $113 million, comprehensive energy efficiency campaign for our customers in 2009. We are also a leader in this nation’s reentry into the nuclear energy arena, on tap to build two new nuclear facilities in 2016 and 2019 with our partner SCANA.

If I were not here today, I'd be at an economic development event. One of our largest industrial customers, Showa Denko Carbon, Inc, is announcing a multiple-hundred million dollar investment to expand their facility. This project will create 100 new jobs. Here's the point: by far, their biggest concern going forward with this project is the uncertainty created by EPA's GHG and non-GHG regulations.

This example spotlights the issues with GHG regulations. The proposed GHG regulations will result in higher costs and greater uncertainty for my customers. EPA also has announced its desire to address GHGs from the power sector through new source performance standards that

will set emissions guidelines for existing plants. There is currently no off-the-shelf technology available to address GHG emissions at a commercial scale - making it different in like and kind from other emissions regulated under the Clean Air Act.

New construction projects will likely be significantly delayed because there is no clarity in how to address GHG in PSD permits. EPA's failure to provide the necessary tools, information, and direction will lead to permits being delayed, and complex legal challenges to permits.

The Clean Air Act was simply not designed to address GHG emissions. The policy to limit GHG emissions should be set by Congress. Continuing on a path toward regulating GHG emissions under the Clean Air Act could stifle the already slow permitting process, raise costs, and limit economic development and industrial growth around our country at a time when we need jobs the most.

EPA also plans to adopt numerous new rules over the next few years, including coal ash, maximum available control technology standards, cooling water intake rules, air quality standards for ozone, lead and particulate matter. Individually, they represent sizeable cost impacts. Together, they could be enough to significantly curtail economic development and may force the premature closing of low cost, reliable power facilities that keep our nation running.

I support Chairman Upton's proposal that would remove regulation of GHG from the Clean Air Act. The secret to success is a balanced and thoughtful approach that factors in the cost impacts of these proposed regulations to customers.

Thank you for this opportunity and for your attention. I am happy to answer any questions you may have.