SC utility hopes to fix poor reputation of a long-troubled system with merger

COLUMBIA — South Carolina utility regulators signed off on a takeover by the state’s largest private water utility of a fellow private water system, one plagued by environmental issues and customer complaints.

South Carolina Water Utility’s absorption of the former Blue Granite system became official at the start of this month. Now the joint company faces the challenge of reversing a decades-long reputation for high bills, sewage spills and water outages.

“We recognize the history and the background that Blue Granite has, and we’re working to overcome that,” President Craig Sorensen told the SC Daily Gazette.

Over a 20-year period beginning in the 1993, when Blue Granite did business as Carolina Water Service, and ending in 2013, the company and its subsidiaries were hit with 55 enforcement orders by state environmental regulators over wastewater pollution statewide, The State newspaper previously reported. The company wracked up $645,000 in fines for the violations.

In the decade after, the company faced 15 more enforcement orders — nine for pollution and six related to drinking water. The company paid a total of $95,000 in fines, according to the state Department of Environmental Services.

In 2015, Congaree Riverkeeper sued in federal court over a number of those spills — 23 in total between 2009 and 2015 from Blue Granite’s plant near Interstate 20. That case was settled out of court.

The town of Lexington then went to court in 2019 and 2020 to shut down the I-20 plant and one other that discharged into the Saluda River, spending millions to buy them out.

When Blue Granite tried to pass $400,000 in legal costs from fighting its fines off to customers in the form of a 50% rate hike, the company and regulators fought all the way to the state Supreme Court. Blue Granite also wanted customers to offset the cost of moving its headquarters from West Columbia to a new office tower in downtown Greenville and to pay for a rebranding campaign meant to reverse the reputation for pollution and bad customer service the utility had earned throughout the state.

Despite describing it as “opulent,” the court allowed the company to include the new office space it rented at triple the cost of its previous location. But it ruled regulators were within their rights to deny the inclusion of the legal fees.

The trouble didn’t end there. The town of Irmo, in 2021, considered taking over Blue Granite’s sewer service in parts of the town over what former Mayor Barry Walker called “flat out evil” billing practices. The town ultimately backed away.

And in 2023, York County invoked eminent domain to buy out Blue Granite’s water system around Lake Wylie after years of complaints about high bills and poor water quality.

State Sen. Wes Climer, R-Rock Hill, sponsored a $20 million earmark in the state budget that year to help York County cover the cost of the buyout without having to pass all of the cost on to customers.

Climer told the SC Daily Gazette’s the regular complaints he used to receive have all but disappeared since the county’s takeover.

While it took the Public Service Commission giving the final legal nod for a joint South Carolina company covering 70,000 customers from the Lowcountry to the Upstate, Blue Granite and South Carolina Water’s parent companies actually began the merger process in April 2024. Together the two parent companies became Nexus Water Group, with 1.3 million customers across 12 U.S. states and two Canadian provinces.

In the interim, South Carolina Water “has already reduced Blue Granite’s annual expenses through targeted operational improvements, including the closure of high-cost facilities, reorganization of field operations, and optimization of administrative processes,” according to a company press release.

Sorenson said among its first actions was closing Blue Granite’s Greenville office — the one the justices called opulent.

South Carolina Water, which already had customers in northeast Columbia, Kiawah Island and Beaufort, also has the benefit of an in-house maintenance team versus having to call in outside contractors to make repairs, Sorensen added.

But while the new joint company is working on finding savings, customers shouldn’t expect their bills to come down.

Rates are set by regulators on the state Public Service Commission and Blue Granites’ last rate increase is more than five years old.

“Costs have escalated since 2019, with periods of unprecedented inflation along the way,” Sorensen said. “Our power bills go up just like everybody else’s, we get hit with freight charges and extra things just like everybody else, too. And unfortunately we just can’t shoulder all those costs forever.”

While South Carolina Water will be seeking permission to raise rates sometime in the near future, he said, the company is “taking steps to limit any increases.”

And at least when it comes to customer service, Irmo Mayor Bill Danielson said he’s noticed a difference over the past couple of years since South Carolina Water became involved.

“My phone’s not ringing and the emails are not coming in,” he said. “They seem to have made quite a few improvements… I have noticed a definite change to a positive.”

Still, sewer service bills remain at $94 per household monthly since Blue Granite last bumped rates, Danielson said.

“When the fees go up and the service is not good, that doesn’t go well,” he said.

Sorensen said the challenges of Blue Granite’s system aren’t going to go away just because South Carolina Water now owns them.

The issue, he said, is that companies like his step in when a city or county isn’t willing to run pipe to a far-out development.

“So, you end up with a lot of very small systems,” he said.

“Water is very difficult to move. Wastewater is very difficult to move and transport,” Sorensen added. “As a result, a lot of these systems are really kind of self-contained.”

They require the same amount of maintenance and testing as large systems, but those costs are spread over fewer customers. Sorensen said he’s hopeful, because South Carolina Water also operates in the Midlands, it can help reduce the per-customer cost by having a larger combined customer base to pay for them.

“There’s still going to be some disjointedness, because we’re not everywhere Blue Granite is, but we do bring skills and capabilities and support systems that can reach out and cover all those systems too,” he said.

The company, in its statement, touted improved customer metrics: complaints shrank by about 1,000 a year over the last two years, and boil water advisories have decreased by more than 80% over that same time period. Annual surveys also show satisfaction was up to 62.6% in 2025, compared to a dismal 18.8% in 2021.

Crews are doing more to find blockages before they blow up into a bigger problem. And when issues do arise, Sorensen said, he’s setting expectations that they are fixed quickly.

“I think in the utility space you really have to start with service,” he said. “If you don’t provide good service, then then you’re really not approaching things the right way.”