PUBLIC HEARING SET FOR WEDNESDAY SEPT. 27TH: DUKE ENERGY ASKING FOR 16.7 PER CENT RATE INCREASE

PUBLIC HEARING SET FOR WEDNESDAY SEPT. 27TH: DUKE ENERGY ASKING FOR 16.7 PER CENT RATE INCREASE PUBLIC HEARING SET FOR WEDNESDAY SEPT. 27TH: DUKE ENERGY ASKING FOR 16.7 PER CENT RATE INCREASE

THE PUBLIC WILL HAVE AN OPPORTUNITY TO BE HEARD ON THIS RATE INCREASE REQUEST AT A N.C. UTILITIES COMMISSION PUBLIC HEARING THIS COMING WEDNESDAY FROM 7 TO 10 PM IN THE BUNCOMBE COUNTY COURTHOUSE  

WILL COST CUSTOMERS IN WNC MORE IF APPROVED   

Duke Energy Carolinas LLC filed a request Friday to raise residential customers' rates by an average 16.7 percent annually to help paying for a 10-year modernization initiative.

The proposed rate hike would affect about 2 million customers from Durham to the western part of the state, including the Triad, and amount to $647 million in new annual revenue.

The request was submitted to the N.C. Utilities Commission, which could take seven to nine months to decide on whether to grant a rate increase and by how much. If approved, it would be the first rate increase for that part of the state in five years.

The utility projects a residential customer who uses 1,000 kilowatt-hours of electricity monthly would pay about $122.68, reflecting an increase of $18.72.

The utility also wants to raise its rate by an average 10.9 percent on commercial and industrial customers in that region.

Duke Energy Carolinas separately filed a request for commission approval to halt its Lee nuclear plant project near Gaffney, S.C.

The Charlotte Observer reported the utility wants to be allowed to recoup up to $636 million in Lee project development costs from customers. The recouping would represent $53 million of the $647 million annual revenue increase for a 12-year period.

"Nearly half of the rate request reflects investments in cleaner generation, including hydro, solar and natural gas," the utility said.

"Duke Energy Carolinas has maintained rates below the national average, and with the proposed change, customers would continue to pay rates lower than in 1991, when adjusted for inflation."

Duke Energy Progress, which covers the eastern parts of N.C. and portions of the Asheville region, earlier requested a 14.9 percent overall rate increase — including 16.7 percent for residential customers — for 1.3 million customers. That increase is projected to gain Duke Energy Progress an additional $477 million in annual revenue.

"As our state grows, and as we think about the future energy infrastructure required to serve our customers, a smarter grid will facilitate cleaner energy sources and provide customers the tools they need to make more informed energy decisions," David Fountain, Duke Energy's North Carolina president, said in a statement.

Fountain said in a Tuesday interview with the Winston-Salem Journal that "we don’t take this (rate increase) lightly and understand its impact on low-income households and small businesses."

Challenges
Although Duke Energy Carolinas gained on Dec. 27 federal Nuclear Regulatory Commission approval to build the Lee plant and operate two nuclear units, it has chosen to abandon the project, primarily because the nuclear-reactor supplier, Westinghouse, filed for bankruptcy March 29.

Duke Energy Carolinas had estimated the total Lee plant project cost at $12.94 billion. It has spent $542 million in project development costs as of June 30.

Westinghouse's "publicly stated intent to cease construction of new nuclear units in the U.S. have placed significant uncertainty on the project," the utility told the commission.

"It is unlikely the company will be able to construct and commence operation of the project before the end of the next decade.

"These recent events support the conclusion that the project, as originally contemplated, should be cancelled in the best interest of customers," the utility said.

However, the utility said it will maintain the license — at least for now — to build a nuclear plant at this site.

Jim Warren, director of advocacy group NC WARN, said he has mixed feelings about the decision to cancel the Lee project. His group already has committed to challenging the rate increases.

"We’re glad that Duke is cutting the losses it must share with the public," Warren said. "Duke Energy executives invested 12 years and over a half-billion public dollars — at the Lee project alone — hoping to build nuclear plants.

"Sadly, it validates the long-running concerns that the nuclear 'renaissance' would waste precious time and resources that should have gone toward proven measures that would slow the climate crisis."

Warren said he "strongly urges" Lynn Good, Duke Energy's chief executive, "to finally turn all efforts toward actually going green, thus aligning Duke Energy’s interests with those of all humanity at this late hour."

'Clarity and transparency'
The rate increase will help the utility pay for compliance with state and federal regulations involving managing coal ash since 2015, Fountain said.

In April, Duke Energy attorneys told the Greensboro News & Record that the utility meets the “criteria for granting a deferral,” a special accounting technique enabling it to set aside more than $700 million in accumulated coal ash costs for consideration in the upcoming rate case.

“The companies reiterate their commitment that costs associated with this deferral request do not include fines, penalties or remediation costs associated with the Dan River pipe break repair and resulting cleanup,” the attorneys said. Fountain made similar comments Tuesday.

In April, the NC Conservation Network filed a petition with the utilities commission about separating the coal ash costs from any rate increase request by Duke Energy.

“The cost and responsibility for coal ash storage and disposal remains a complex issue which deserves special attention,” the advocacy group said. “North Carolina ratepayers need clarity and transparency as Duke Energy seeks to raise our rates to pay for its coal ash problems.”

Duke Energy lawyers said critics are wrong in urging the commission to consider the company’s coal ash costs separately.

Duke Energy contends the great majority of its coal ash cleanup costs across North Carolina — expected eventually to top $4.5 billion — are part of the routine life cycle of its 14 active and retired coal-fired plants.

Meanwhile, N.C. Attorney General Josh Stein and other intervenors, including the Sierra Club, Appalachian State University and the Carolina Utility Customers Association, argued that Duke Energy’s coal ash dilemma simply contains too many factors that utility executives brought on themselves, or that otherwise beg closer examination than the company’s proposed bookkeeping maneuver suggests.