Industry group draws scrutiny over barrage of fraudulent emails in South Carolina

Consumer Energy Alliance's tactics also questioned in Ohio and Wisconsin.

Members of the South Carolina Legislature received bogus emails in support of Dominion Energy's proposed acquisition of SCANA Corp. CREDIT: Davis Turner/Getty Images
Members of the South Carolina Legislature received bogus emails in support of Dominion Energy's proposed acquisition of SCANA Corp. CREDIT: Davis Turner/Getty Images

South Carolina law enforcement officials have opened an investigation into emails that were sent to state lawmakers in support of a mega-merger between Dominion Energy and utility company SCANA Corp. Many of these emails — all based on the same template — used the names and addresses of people without their knowledge. The industry group that encouraged customers to tell state lawmakers they supported the merger says it had nothing to do with the falsified emails, despite a history of deceptive letter campaigns.

The Consumer Energy Alliance (CEA), a group with dozens of energy industry members including Dominion Energy, admitted the form letters in support of Dominion’s proposed acquisition of SCANA came from the group’s website. But David Holt, the president of the group, told The Post and Courier of Charleston, South Carolina, that his group was not involved with sending out the fraudulent emails.

Advertisement

South Carolina lawmakers received a barrage of form emails last week from constituents urging the legislators not to pass any laws that could kill the merger deal. Some of the people who supposedly sent the emails say they were impersonated. In response to a request from the South Carolina attorney general’s office, the State Law Enforcement Division on Tuesday opened an official investigation into the matter.

The CEA is an energy industry-funded advocacy group founded about a dozen years ago. In addition to major utility companies like Dominion, the group counts BP, Chevron, ExxonMobil, Marathon, and Shell as its members.

“It is unconscionable, if not illegal, to mislead legislators by falsifying emails from real South Carolina residents. And the state’s leaders shouldn’t have to wonder if every communication with a constituent is legitimate,” The Post and Courier, wrote in an editorial published Tuesday.

Advertisement

Holt, the group’s president, sent a letter to South Carolina’s attorney general explaining that the letter was part of a “grassroots campaign” conducted by the group “on behalf of electricity consumers in South Carolina.”

After Dominion announced its proposal to acquire SCANA in January, CEA contacted the company and asked if it could get involved in the public discussion about the merger in South Carolina. Dominion welcomed CEA’s offer to advocate on behalf of the deal, Dominion spokesperson Chet Wade told ThinkProgress. After CEA put together a draft of the form letter, the group provided Dominion with a copy so the company would know what would be sent to lawmakers, Wade said.

Dominion was “very discouraged and disappointed” when it learned about the fraudulent emails because it diverted attention from the policy discussions it is promoting in South Carolina about the proposed acquisition, according to Wade. “We don’t think there’s any room in public discourse for that kind of activity,” he added.

Matt Kasper, research director at the Energy & Policy Institute, told ThinkProgress that CEA cannot call its website a “grassroots vehicle” when it’s funded by corporations and associations. “It’s important public officials on the receiving end of these petitions understand it’s an astroturf campaign. A Dominion spokesperson even admitted that they have been in contact with CEA regarding the developments in South Carolina,” Kasper said.

Advertisement

This isn’t the first time CEA’s campaign tactics have been questioned. In 2014, the organization was caught submitting a fraudulent petition to the Public Service Commission (PSC) of Wisconsin that attacked net metering and defended utility companies’ fixed-rate increase proposals in Wisconsin. The petition claimed “changing the current rule will ensure that all ratepayers are treated fairly and electricity bills remain affordable.”

The group submitted names of 2,500 Wisconsin residents that “supported” the electric utility proposals. At the time, the Madison Capital Times revealed that certain people on the petition were in fact against the proposal. The Wisconsin PSC then dismissed the petition saying it would not be included in the record.

At the time, Robert Kelter, a senior attorney with the Environmental Law & Policy Center based in Chicago, argued that “if the only consequence from this is that the petition is thrown out, it’s certainly not a deterrent to CEA in how it handles public comments in other states and other proceedings.”

Similar to Dominion’s recent denial of knowledge of the emails in South Carolina, Madison Gas & Electric and We Energies, two utility companies opposed to net metering in Wisconsin, also denied involvement with the circulation of the misleading petition.

CEA also ran into trouble in Ohio in 2016 when a group of Ohio property owners asked the postal inspection service and the Federal Energy Regulatory Commission (FERC) to conduct a criminal review of the group. CEA had sent 347 letters to FERC supportive of a pipeline proposed by Nexus Gas Transmission, using the names of local residents, including an Ohio man who has been dead since 1998.

Fourteen Ohio residents provided affidavits denying writing letters approving the pipeline as well as giving permission to CEA to write letters on their behalf. Spectra Energy, a partner in Nexus Gas Transmission, also is a member of CEA.

Advertisement

CEA works with all types of energy companies, from electric utilities to natural gas producers. Last year, the group launched a 12-state initiative called “Campaign for America’s Energy.” The campaign’s stated goal is to counter the message of anti-fracking and anti-pipeline activists.

For its South Carolina campaign, Michael Whatley, CEA’s executive vice president, said the group’s staff discovered irregularities with the email campaign last Friday. “We alerted the attorney general’s office first thing on Monday morning,” he said in a statement. “We stand behind our methodology in collecting comments — which is similar to the ways members of Congress and other advocacy groups collect comments.”

In early January, Dominion announced the agreement to acquire SCANA in a deal valued at approximately $14.6 billion. SCANA is hoping the deal is completed so it can move forward after it became mired in controversy over its decision to abandon a new nuclear plant project. Dominion’s CEO warned South Carolina officials that his company would withdraw its proposal to buy SCANA if legislators prevent it from recovering costs from customers for the failed nuclear project.

“As you consider legislation to address the failed V.C. Summer nuclear project, please work to find a solution that will allow significant upfront benefits, long-term stability, and lower rates for all South Carolina electricity users,” CEA wrote in its form letter for residents to send to legislators.

After Dominion announced the acquisition, environmental groups pointed out that the “take-it-or-leave-it deal falls far short of protecting ratepayers from absorbing the costs of the nuclear fiasco.”