Xenophon Strategies

Piedmont Municipal Power Agency

A Government Affairs Initiative

Strategic plan targeted congressional support for infrastructure improvements.

Project Highlights

• Government affairs
• Strategic communications
• Lobbying
• Legislative strategy
• Strategic counsel

Overview

Piedmont Municipal Power Agency (PMPA) is a non-profit public electricity wholesaler that provides electricity to 10 city-owned utilities in South Carolina. With energy costs rising, PMPA sought to help stabilize these costs through the acquisition of a stake in a nuclear power plant. To finance this acquisition, PMPA issued more than $1 billion in debt through tax-exempt bonds, but due to faulty financial projections it was unable to follow through on its plan to repay the debt. Consequently, PMPA was forced to raise electricity rates to some of the highest levels in South Carolina. Not only did this negatively affect PMPA’s customers, but it also created financial hardship for the region, making it harder to attract new business.

The support PMPA has received from Congress will help it to pay back debt requirements, while maintaining energy prices at a level comparable to its competitors.

Xenophon Strategies, working in collaboration with strategic partner Morgan Meguire LLC, was approached in 2003 to help devise a plan to relieve PMPA of its debt burden, while also stabilizing energy costs. The strategy was multifaceted and involved both Xenophon’s government affairs and strategic communications personnel.

Strategy

PMPA operated in an environment in which major energy competitors were pressuring the market to drive prices upward. Meanwhile, some of PMPA’s local competitors were receiving debt relief from the federal government. Xenophon concluded that a campaign focused on energy prices would be difficult because of both a lack of funding programs and a difficult political environment. Instead, Xenophon and Morgan Meguire approached PMPA with a creative concept that was uniquely tailored to meet the needs of PMPA and its member cities, which helped to ease some of their financial burdens.

Xenophon designed a plan that obtained funding for non energy-related infrastructure improvements in the 10 PMPA member cities. The hope was that PMPA could then use the cash initially tagged for infrastructure improvements to relieve stress on energy prices. PMPA member cities demonstrated a need for major improvements such as roadway repairs, waste water treatment plants and job training facilities. In response, Xenophon implemented a campaign to seek appropriations from Congress. As part of the effort, Xenophon made the case for and sought support for PMPA projects.

Results

Xenophon’s close collaboration with both PMPA and government officials at the state and federal levels has been very successful. The support PMPA has received from Congress will help it to pay back debt requirements, while maintaining energy prices at a level comparable to its competitors.