INSTITUTE FOR SOUTHERN STUDIES
 

EMBARGO: Hold for release or broadcast until Thursday, June 13
FOR MORE INFORMATION:
Jordan Green, 919-419-8311 x31, jordangreen75@earthlink.net
Chris Kromm, 919-418-8311 x26 chris@southernstudies.org

CP&L'S "UNDUE INFLUENCE" DOMINATES NORTH
CAROLINA POLITICS, STUDY FINDS
Power company's massive campaign contributions, other means of
influence linked to worsening air quality and nuclear safety risks

DURHAM, N.C. - Utility giant Carolina Power & Light exerts "massive and undue influence" over politics in North Carolina - often resulting in policy decisions that benefit the corporation, but threaten air quality, nuclear safety and consumer accountability in the state. That's the conclusion of a report released today by the Institute for Southern Studies, a non-profit research center.

Drawing on state election data, public records, personal interviews and news analysis, the report "Power Politics" is the first study to systematically document the ways CP&L - a subsidiary of Fortune 250 corporation Progress Energy - wields its political might.

"From backing powerful politicians to aggressive PR campaigns, CP&L and Progress Energy invest millions of dollars to cultivate influence - and it pays off," says Jordan Green, the report's lead author and a research associate at the Durham-based Institute.

"Against that kind of money and power, citizens concerned about code-red air pollution, radioactive disasters, and consumer rights don't stand much of a chance," Green adds.

The report details a variety of strategies used by CP&L and Progress Energy to dictate policy in the state, including:

• CP&L and Progress Energy provide generous financial backing to key political figures in both parties and at all levels of government, ranking among the top corporate contributors to North Carolina elected officials. In the last decade alone,
• CP&L/Progress Energy's PAC gave $603,150 in direct political donations to state officials and candidates - a figure which doesn't include individual contributions from corporate executives or "soft money" to political parties.
• In the last election, 72 percent of N.C. state senators, and 64 percent of state House members benefited from CP&L campaign backing.
• CP&L employs a small army of powerful political operatives, including the state's top-ranked lobbyist, Zeb Alley, as well as a revolving door of political officials, to sway policy to their advantage.
• In 2001, the Progress Energy Foundation dispensed $7.6 million in charitable contributions - part of what The Business Journal calls the companies' "strategic philanthropy" in the state.
• Each year, CP&L and Progress Energy spend millions of dollars on aggressive advertising and PR campaigns - estimated by one source at over $20 million a year - even though the companies have a guaranteed market due to electricity regulation.

The pay-off for this investment, the report charges, is "undue influence" in shaping state politics and a stifling of criticism of corporate practices. The study examines three cases where CP&L and Progress Energy's inordinate sway have resulted in policies contrary to the public interest - air quality, nuclear safety, and consumer accountability:

• As evidence mounts of a growing public health crisis from smog and other air pollutants, the report documents how CP&L pressured the N.C. Environmental Management Commission to water-down air quality standards in 2000, with support from CP&L-backed Gov. Jim Hunt.
• With federal officials naming nuclear facilities as high risks for terrorist attacks, CP&L's train shipments and stockpiling of high-level nuclear waste at its Shearon Harris plant have come under citizen scrutiny. Yet state and national political figures like Rep. David Price - whose top corporate backer is CP&L - have declined to support local officials who are calling for open hearings on the public health risks.
• CP&L and parent Progress Energy have played politics with energy deregulation - on one hand funding a secret "front group" to lobby to preserve their regulated market, decried "as shameful conduct" by a Republican spokesman, and on the other pressuring the North Carolina Utilities Commission to approve Progress Energy's transformation into an Enron-like "holding company" to exploit deregulated markets, lowering accountability to consumers.

"Right now in Washington, elected leaders are conducting hearings on how energy giants like Enron manipulated politics to the detriment of the public," says report co-author Chris Kromm, who notes that Progress Energy recently hired former Enron executive Joseph Hirl.

"I hope our state officials have the same courage to investigate the overwhelming - and corrosive - influence CP&L and Progress Energy have in North Carolina politics," Kromm adds.

Founded in 1970, the Institute for Southern Studies is a non-partisan research and education center that studies the politics, economics and culture of the region. It also publishes Southern Exposure, a quarterly journal and past winner of the National Magazine Award and George Polk Award.

For free media copies of "Power Politics," please contact Jordan Green at 919-419-8311 x31 or jordangreen75@earthlink.net. Public copies of "Power Politics" are available for $15 for Institute members and $30 for non-members at ISS Reports, P.O. Box 531, Durham, NC 27702.

Executive Summary