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Discrepancies in Duke Energy’s 20-year Plan Require Full Hearing, Cross Examination — News Release from NC WARN

Groups thank commission for heeding public concerns with its ruling that challenges Duke’s growth projections and lack of clean, rate-reducing options

Durham, NC – Watchdog groups contesting Duke Energy Carolinas’ long-range plans have called on state regulators to schedule full hearings over discrepancies between statutory requirements, Duke’s official filings and public statements made by CEO Jim Rogers. The case goes to the heart of Duke’s business model of raising customer rates to fund new power plants – which critics argue aren’t needed – and to continue using its workhorse coal fleet for decades.

The long-range plans, called Integrated Resource Plans, or IRPs, form the basis for approval of new power plants. In a motion filed yesterday, NC WARN, Greenpeace and the Blue Ridge Environmental Defense League thanked the NC Utilities Commission for its May 10 order questioning Duke’s compliance with state rules requiring “the least cost mix of generation and demand‑reduction measures which is achievable.”

The order was a rare rebuff to what Rogers now says is the world’s largest corporate utility, which, for many years, critics have complained wields pervasive influence over state government. Citing widespread concerns expressed at public hearings in February, the Commission ordered Duke and subsidiary Progress Energy to provide written answers to a series of questions about the company’s minimal projections for energy-saving programs and renewable power sources, high projections for demand growth, questionable reserve margins, and Duke’s failure to consider excess supply from neighboring power providers.

The Commission called for Duke to explain Rogers’ statements at a November energy conference where, as reported by the Charlotte Business Journal, he told a Duke University business audience that, “I think demand for electricity may be flat or declining in the future …”. This contradicts Duke’s 20-year IRP filed with the regulators in September, which projected a hefty 1.4% annual growth.

The groups say these inconsistencies require more than written answers to Commission questions, and they reiterated their February motion calling for evidentiary hearings based on the September IRPs filed by Duke and subsidiary Progress Energy. As attorney John Runkle wrote, “An evidentiary hearing, in which the utility witnesses are cross-examined and intervenor witnesses are presented, remains the most effective way to test the assertions of the utilities.”

Duke has been buffeted in recent years by customers in its home state angry over repeated rate hikes and plans to keep building power plants instead of deploying energy saving programs. As today’s motion states: “As presented in our [earlier filing], and supported at the public hearings, there are far better ways, ones which save ratepayers money, reduce health and environmental costs, reduce the imminent hazards of global warming and enhance our state’s economy.”

The groups argue that solar, wind, energy-saving programs and combined heat and power are all cheaper than building unneeded power plants – especially when all costs are considered. Studies by both Greenpeace and NC WARN conclude that, used together and alongside massive energy storage capacity Duke already owns in South Carolina, those technologies could allow an expeditious phase-out of nearly all fossil-burning power plants, thus dramatically reducing global warming pollution.

The watchdogs reiterated an earlier request that the Commission require Duke to explain its rationale for ignoring combined heat and power, a long-proven efficiency technology that could capture wasted energy at thousands of hospitals, schools and factories across the state. An NC WARN report submitted to the Commission in February found that CHP could potentially displace the need for 10 large conventional power plants – at a lower cost than building new plants.

As attorney Runkle wrote: Have Duke and Progress “conducted an analysis or study of the potential for using combined heat and power to support forecasted need for generation capacity and reserve margin, and the financial impacts of CHP on industrial customers and other potential participants in CHP projects? If so, please provide a copy of that study or analysis. If not, please explain why DEC has not conducted such an analysis or study.”

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NCUC Order May 5 – Posing questions to Duke-Progress

See NC WARN’s February report on CHP: Replacing Large Power Plants by Putting Wasted Energy to Work

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