NC WARN: Waste Awareness & Reduction Network
August 12, 2009
More Evidence Shows Coal-Power Plant Is Not Needed
New Duke Energy document shows rate hike will cause long-term electricity sales to fall; NC WARN says Utilities Commission must connect the dots, and avoid decades of soaring power bills
DURHAM, NC – A Duke Energy document resting at the back of a voluminous rate hike request adds to a bundle of earlier proof that Duke Energy’s Cliffside power plant is not needed, a watchdog group said today. NC WARN attorney John Runkle told NC Utilities Commissioners they must “connect the dots” between various stacks of evidence, and conduct evidentiary hearings over plans by Duke and Progress Energy to build power plants that the group says would waste tens of billions of customers’ dollars.
Today the group filed with the Commission a motion to reconsider its decision not to hold evidentiary hearings on the utilities’ long range projections of electricity supply and demand – which form the basis for decisions about whether new power plants are necessary.
The environmentalists say there are now at least seven separate reasons (see below) that each prove Duke’s Cliffside plant isn’t needed, including three more revealed today. The first: by Duke’s own calculation, its 18% rate hike*, if approved, will cause customers to reduce electricity usage. So instead of continued growth in demand – the key factor cited by Duke for building Cliffside – the amount of power the company sells will actually fall slightly over the next six years.
The second piece of new evidence against Cliffside is yesterday’s order by the Utilities Commission that Duke must revisit the availability of electricity across the region. The company projects reducing power purchases from other utilities by over 600 megawatts – which is the same amount of net capacity being added at Cliffside. Since last year, NC WARN has cited regional utility data showing there is excess power capacity in the Southeast for many years into the future.
Thirdly, Duke’s long-range plans do not reflect the projected one percent annual energy savings the company has pledged to achieve with a proposed revision of its “Save-a-Watt” program. Runkle told the Commission those savings alone would eliminate the need for new plants.
The utilities’ projections have been challenged by Dr. John Blackburn, retired chairman of the Duke University economics department, who has long argued that modest increases in energy efficiency and cogeneration, along with renewable power already required in North Carolina, can avoid the need for costly new coal and nuclear plants, and even allow the closing of existing coal-fired plants.
The Commission initially denied NC WARN’s request for a hearing after Duke and Progress presented “strong objections” to Blackburn’s analysis.** But as Runkle noted, “By dismissing the findings of Dr. Blackburn without allowing him to defend his expert opinion, the Commission is ruling on evidentiary matters without the benefits of fully considering the evidence.”
“Now more than ever, the Commission must conduct full, open debate,” said Pete MacDowell of NC WARN today. “With maximum controversy over our energy, economy and climate change, this would be the very worst time to allow the utilities to avoid scrutiny.”
NC WARN and 24 other nonprofits have appealed to the NCUC to overturn permission to build the $2.4 billion Cliffside unit based on the growing evidence that the plant is not needed.
Meanwhile, Duke continues soliciting customers outside its service area as it appeals a Commission ruling against such expansion. The utility’s long-range projections show 600 MW of unidentified new wholesale customers – the same amount of net capacity Duke is building at Cliffside.
“This is the time for more scrutiny of these issues by the Commission – not less,” added NC WARN’s MacDowell. “The Commissioners must protect North Carolinians against decades of soaring power bills caused by power plants that are not needed.”
Proving Cliffside Isn’t Needed: Seven Separate Reasons
1. Duke Energy has steadily reduced its forecasted growthover the next 15 years. Appendix D of Duke’s rate increase request shows the amount of power the company sells will actually fall slightly over the next six years. This alone nullifies the need for Cliffside.
2. A Commission ruling (Orangeburg docket) against Duke’s efforts to sell electricity outside its service area entirely eliminates the need for the Cliffside plant. But Duke continues soliciting outside customers as it appeals the Commission ruling, and the company’s Integrated Resource Plan projects 600 MW of unidentified new wholesale customers – the same amount of net capacity being built at Cliffside.
3. Duke’s recent commitment in a proposed settlement of its controversial Save-a-Watt program decreases the need for Cliffside even further – if Duke plans to keep its word.
4. The company’s long-range projections use exaggerated reserve margins; reducing them to reasonable levels further diminishes the need for new plants.
5. Southeastern utilities, including Duke, plan to greatly overbuild power plants so they can increase sales to other regions, according to industry data from the Southeast Electric Reliability Corporation.
6. A March study of Duke’s long-term data by a Duke University economist shows the need for Cliffside – plus new nuclear plants – can be eliminated by modest increases in energy efficiency and cogeneration, along with renewable power at levels already required in North Carolina. Previous studies by Duke Energy, the state and others show similar conclusions.
7. The company projects reducing power purchases from other utilities and merchant plants by over 600 megawatts – the same amount of net capacity being added at Cliffside. On August 11th, the Utilities Commission directed Duke to revisit the availability of electricity across the region.
* Duke recently applied for rate hikes of up to 20 percent for current customers in order to fund Cliffside and other projects; the NCUC already approved 4.5 percent for rising coal prices.
** Dr. Blackburn’s report: https://www.ncwarn.org/docs/reports/ncw_report_r8.pdf