Embattled CEO Jim Rogers will face off against a former NRC commissioner and state regulatory head, as NC legislature ponders “annual rate hike bill”
Statement by Executive Director Jim Warren:
DURHAM, NC – Duke Energy CEO Jim Rogers is now under an FBI investigation for “wining & dining” Indiana’s top utility regulator, allegedly seeking to ensure his customers absorb massive cost overruns at a power plant construction project. At a March 15th hearing in Raleigh, he will come cap in hand for regulators’ approval to spend another quarter-billion ratepayer dollars for a high-risk nuclear power project in the Carolinas that he has not committed to building, and for which he has gained neither state nor federal licenses.
If the NC Utilities Commission approves Rogers’ request, it would bring to $459 million the total-to-date in “pre-development” costs that Duke wants customers in the Carolinas to invest in engineering and licensing expenses for the Lee nuclear station in South Carolina.
Presenting a counter-message that the long-hyped U.S. nuclear renaissance “is in shambles” – and that customer money should not be gambled on high-risk projects rejected by Wall Street – will be a former member of the U.S. Nuclear Regulatory Commission (NRC). Peter Bradford also chaired state utility commissions in New York and Maine in the era when more than 90 U.S. nuclear projects were cancelled in midstream.*
“… Duke Energy is asking the Commission to more than double customer exposure to cost and risk,” wrote Commissioner Bradford in his pre-filed testimony. “No plumber in North Carolina could hope to get away with such a request on an ordinary construction project.”
The North Carolina hearing comes as Duke Energy and Progress Energy are pushing state legislators to allow pre-charging of customers for nuclear plants – and to bypass full Utilities Commission review. Rogers openly insists he can’t attempt to build nukes without such “restructuring” of risks.
A diverse alliance called Consumers Against Rate Hikes is opposing the pending legislation because annual rate hikes would harm businesses and families with what could exceed a 50% rate increase. Also, a statewide manufacturing trade group is now challenging that bill.
Critics argue that Duke cannot justify the need or cost of the Lee project. NC WARN recently filed evidence that Duke leaves so-called “baseload” plants idle for much of the year due to lack of full-time demand – a condition that preceded the economic recession. Meanwhile, Duke continues soliciting outside sales, most recently with Jacksonville, Florida, to justify building lucrative new plants.
One key question is whether Rogers will reveal updated cost estimates for the Lee project.
Duke’s latest published estimates fall several billion dollars below those of two utilities farther along in the planning process. Perhaps Duke knows a short-cut to building the Westinghouse AP1000 that the others haven’t found. Approval of the AP1000 design has now been delayed by five years, and hundreds of design questions remain unsolved, even as the NRC is under industry pressure to sign-off on the design.
Or maybe Rogers is low-balling the estimate so the NC legislature will be misled into saddling customers with even more financial risk.
*NRC list of abandoned nuclear projects from the 1970s and 1980s:
Link to document (Appendix C)