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Group Seeks Ban of Backroom Deals by Duke Energy, Regulators — News Release from NC WARN

NC WARN petitions for new rules requiring fair, open process in cases involving power plants, rate hikes, mergers  

Today NC WARN filed a petition with the NC Utilities Commission that seeks to end the longstanding pattern of Duke Energy and the regulators deciding billion-dollar cases behind closed doors.  Specifically, we’re calling for an open discussion – with all interested parties – on a rules change that would create a fair and transparent process for settling those cases.

Today’s filing follows a statement we published last week detailing how the backroom deal-making game works, and criticizing the regulators for consistently undermining fair process by settling cases in secret with Duke Energy.

That type of backroom deal happened again – for the fifth straight time – in an ongoing case over a $6 billion merger with Piedmont Natural Gas.  The commission’s “public staff” settled secretly with the utility before receiving input from either the public or formal parties to the case.  This time, the commission took the extra step of granting Duke’s request to block testimonies by two natural gas experts fielded by NC WARN and allies.

In cutting all those secret deals, the regulators (the commission and its Public Staff) turn complex, multi-billion dollar cases into rubber-stamp proceedings where Duke Energy avoids open scrutiny.

The Public Staff is supposed to be independent of the commission and its legal staff.  Instead, they play virtually the same game each time Duke wants to raise rates, build a power plant or acquire a smaller corporation.  The commission leadership relies on Public Staff leaders to work secretly with Duke to reach settlements, then the Staff formally endorses the project with modest changes.

The early deal-making heavily predetermines the case so that its outcome will align closely with the backroom deal.  Meanwhile, other parties that have worked with expert witnesses to prepare cases learn their concerns will be ignored, while they are left with insufficient time to redirect efforts toward examining the backroom deal.

Now, we are proposing that the commission adopt rules that require that any negotiations toward settling cases must be open to all qualified parties, with sufficient time for open communication and examination of proposals.  If a party to the case doesn’t agree to a pre-hearing settlement, then at least the hearing before the commission would include well informed parties that can fairly debate the merits of the proposed settlement and the overall case for a power plant or rate increase. We also propose that the rules would prevent settlements from being made until after all parties have submitted testimony and a public hearing has been conducted.

This would be a giant step forward for North Carolina’s electricity customers, for those concerned about the path of our energy future, and for those seeking a state less dominated by corporate money and power.

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