THE SCANA LETTER. A Fresh Look at Economic Development from SCANA Corporation Power for the Way You Work

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1 THE SCANA LETTER A Fresh Look at Economic Development from SCANA Corporation Power for the Way You Work July 2014 Unemployment N. Carolina 6.5% S. Carolina 5.7% National 6.2% Dear Allies: Second Quarter 2014 Southern manufacturing is busy as a hive of bees, positively humming this summer with expansions and relocations: Around South Carolina Palmetto State Armory, a S.C. gun manufacturer, is investing $4.2 million to expand its facility in Lexington County and doubling its workforce, creating 300 new jobs. At least 30 gun manufacturing operations are now located in the South, which has become the new Gun Valley. Gun manufacturers that relocated from the Northeast, such as Remington, Beretta, FNH/Winchester, Ithaca Gun and Mossberg; a wave of start-ups, such as Daniel Defense, Barrett, Kel-Tec, and Wilson Combat; as well as foreign companies, such as Para USA and Taurus, are now thriving here [ Other new announcements in South Carolina include: Aiken County Medac, a provider of services and products to anesthesiarelated health care providers, announced it is building a new facility in downtown North Augusta. The $12 million investment is expected to create 615 jobs. AmbioPharm announced it will invest $5 million to double its manufacturing operations in North Augusta, creating 20 new jobs. Bamberg County Augusta Fiberlass Coating Inc., the nation s leading manufacturer of custom fiberglass reinforced plastic equipment, is expanding in Bamberg (and Barnwell). The $800,000 investment has created 69 new jobs. Green Link Wood Industries Inc., a hardwood veneer manufacturer, announced plans for a new manufacturing facility. The $1.2 million investment is expected to create 44 jobs. Barnwell County Kronotex USA, one of the largest producers of laminate flooring in the U.S., announced it is expanding its operations. The $29.5 million investment is expected to create 28 jobs. Berkeley County JBE, Inc., a supplier to the automotive, aerospace and industrial electrical industry, announced it is expanding into Hanahan to

2 better serve its customers through its proximity to the Port of Charleston. The investment is expected to create 20 new jobs. Charleston County New World Pharmaceuticals, LLC, a specialty pharmaceutical company, announced it will be moving its headquarters to Charleston. Its $21 million investment is expected to create 38 jobs. Aeterna Zentaris Inc., a Canadian specialty biopharmaceutical company, announced it is building its newest North American business and global commercial operation in Charleston. The $1 million investment is expected to create 60 jobs. Colleton County Palmetto Aero, a manufacturer and producer of sheet metal fasteners and airframe components for the aerospace industry, is building a 77,000-square-foot hangar and has acquired two more hangars. The $2.5 million investment is expected to create 44 new jobs. Darlington County - Birdsong Corporation, a Virginia-based peanut processor, announced it will invest $47.3 million to locate a new facility. The investment is expected to create 55 new jobs. Dorchester County Coastal Logistics Group, a third-party logistics provider and warehouse operator, has established a new facility to serve its international customers shipping through the Port of Charleston. The $1.2 million investment has already created 30 new jobs and is expected to create another 30 jobs. iqor US, Inc., a global provider of business process outsourcing and product support services, is expanding its call center. The $391,500 investment is expected to create 320 new jobs. The BID Group of Companies, a Canadian equipment manufacturer for the forest industry, will expand its Comact Equipment U.S. Inc. facility. The $1.8 million investment is expected to generate 60 jobs. Scout Boats Inc., a sport fishing boat manufacturer, is expanding its facility. The $2.5 million investment is expected to create 300 jobs. Fairfield County Hidral USA Inc., a Spanish manufacturer of freight elevators, platforms, lifts and conveyors, selected Fairfield for its newest sales office its first facility in North America. The $1.5 million investment is expected to create 25 jobs. Hampton County Dixie Poly-Drum Corporation, a leading manufacturer of plastic safety and workplace products, is rebuilding its facility. The $1.1 million reinvestment is expected to create 84 jobs. Lexington County - Signode, a leading manufacturer and distributor of protective packaging systems, is expanding its S.C. operations. The $15 million investment is expected to create 130 jobs. North Carolina Perspectives

3 CNBC ranked North Carolina as the fifth best state for business in its annual Countdown to America s Top State for Business feature. This is the state s highest ranking since Tourism spending in North Carolina reached a new record of $20 billion in 2013, up four percent from the previous year. The nearly 53 million visitors to the state supported 198,270 jobs and $4.6 billion in payroll income. Tourism is a key element of our economic development strategy, said Sharon Decker, Secretary, N.C. Department of Commerce. Sealed Air Corporation, the Bubble Wrap manufacturer, announced it is relocating its global headquarters from New Jersey to Charlotte, creating 1,262 jobs by the end of 2017 and investing $58 million for a new state-of the-art facility. The average annual wage will be $119,482. In April, Governor Pat McCrory and state officials announced the launch of a major workforce development program NCWorks. According to McCrory, NCWorks will promote a consistent, cohesive strategy that focuses on one goal connecting N.C. workers with N.C. jobs. The Southeast and Beyond Time to cut social studies and sign up for shop class! Josh Mandel, State of Ohio treasurer, visited Pioneer Pipe in Ohio and learned the company paid 60 of its welders more than $150,000. Pioneer Pipe s owner, Dave Archer, said he has had to turn down orders because he can t find enough welders. According to Mandel in The Wall Street Journal, shop class has been vanishing from high school curriculums since the 1970 s, when it became conventional wisdom that a four-year college degree was essential. Yet a 2012 Bureau of Labor Statistics study shows that 48% of all college graduates are working in jobs that don t require a four-year degree - and according to a 2011 Skills Gap Survey by the Manufacturing Institute, about 600,000 manufacturing jobs are unfilled nationally because employers can t find qualified workers. Toyota announced a sweeping cost-cutting reorganization and the relocation of its North American operations from California to Plano, Texas. California will lose as many as 3,000 jobs, while Texas will gain 4,000 jobs. Texas offered Toyota $40 million from its Enterprise Fund incentive program for the move, according to The Wall Street Journal. Energy News South Carolina Electric & Gas Company, a subsidiary of SCANA Corporation, received the 2014 President s Award from the SERC Reliability Corporation, one of eight regions in the U.S. responsible for monitoring the reliability of the power system. The award is given annually in recognition of electric reliability excellence. South Carolina signed into law S.B.1189, the Distributed Energy Resources Act, a renewable energy policy that will open the door for increased solar

4 installation across the state. Distributed energy describes electricity generated from many small energy sources - including rooftop solar panels and wind turbines. The bill was the result of a successful collaboration by lawmakers, regulators, environmental advocates, consumer groups, utilities, businesses and non-profits [ On June 2, the Environmental Protection Agency unveiled its Clean Power Plan, a plan to impose drastic, 30% cuts in carbon emissions that would have a dramatic impact on the American economy but only a minimal effect on global carbon emissions according to Edwin D. Hill, president of the 750,000 member International Brotherhood of Electrical Workers, in the Wall Street Journal. Hill says that when gauged by accepted industry metrics, the plan would result in the loss of some 52,000 permanent direct jobs in utilities, mining and rail; 100,000 jobs in related industries; and the loss of up to 49 gigawatts of coal generated electricity. The 49 gigawatts lost will be in addition to another 60 gigawatts lost because of EPA s 2012 Mercury and Air Toxics Standards rule. Hill states, The U.S. cannot lose more than 100 gigawatts of power in five years without severely compromising the reliability and safety of the electrical grid. That would pose a danger for the entire economy and all Americans. The comment period on the EPA plan remains open until October 14, Coal retirements posing reliability problems. American Electric Power, one of the country s biggest utilities, reported that it used 89 percent of the coal-fired power it is retiring in 2015 to meet electricity demand last January. Another utility, PJM, was running literally on the edge of its power reserve margin several times last winter and New England is also in crises mode, said Commissioner Phillip Moeller of the Federal Energy Regulatory Commission [ U.S. Congressman Bradley Byrne (R-Ala.) says that inexpensive energy has been a key factor in industrial recruitment in his state and that federal carbon policies are motivated by a desire to erase Southeast s competitive advantage [blog.al.com]. Continuing a federal ban on drilling off the Atlantic seaboard would cost up to 280,000 jobs and $23.5 million a year in economic activity and would deny citizens and businesses in Atlantic Coast states and beyond from a major opportunity to realize significant economic and societal benefits for many years to come, warns Chris Clark, Georgia Chamber of Commerce president and CEO, in a response to the Bureau of Ocean Energy Management [in wwww.bizjournals.com/atlanta/blog]. Sound Bites & Factoids On the EPA s Clean Power Plan:... the timing of this effort could hardly be worse for the struggling U.S. economy... [We] believe that consumers will see higher rates. Businesses, large and small, and manufacturers will have to pay much more for their electricity; these increased prices will be absorbed

5 or passed on and will further hurt the economy. Senators John Barrasso [R- Wyoming] and Heidi Heitkamp [D-North Dakota][Wall Street Journal]. Best to you, Sharon K. Dovell, Editor SCANA, headquartered in Cayce, South Carolina, is an energy-based holding company that works in partnership with the S.C. Department of Commerce, regional alliances, local communities and site selection consultants to assist with relocations and expansions in the Carolinas. We provide natural gas to more than 1.2 million customers in South Carolina, North Carolina and Georgia and electricity to more than 684,000 customers in South Carolina. Please visit us on the Web at or call us at Send address changes and subscription requests to