Today NC WARN sent the letter below to Attorney General Roy Cooper. Highlights include:
- We urge him to challenge the rigged and unconstitutional process leading to approval of a large, climate-wrecking power plant.
- Duke Energy’s control over the legislature and regulators is clearly evidenced in the fast-track approval, and Duke plans to build up to 15 large fracking-gas power plants.
- We are redoubling the call for Cooper to use his policing authority over Duke Energy’s state-issued corporate charter – or explain why he thinks this is not his duty.
- His leadership is desperately needed to protect North Carolinians from Duke Energy’s enormous fracking-gas expansion and the accelerating climate crisis.
March 21, 2016
Attorney General of North Carolina
Attorney General’s Office
9001 Mail Service Center
Raleigh, NC 27699-9001
Re: OUR EMERGENCY COMPLAINT IS BOLSTERED BY RUBBER-STAMP APPROVAL OF DUKE ENERGY’S $1.1 BILLION POWER PLANT
Dear Mr. Cooper:
NC WARN hereby files this supplemental request to the October 7 Emergency Complaint calling for your assistance in policing Duke Energy’s corporate charter, based on a deeply flawed political and regulatory proceeding that perfectly emblemizes our concerns about Duke Energy’s influence over state government.
We encourage you to challenge the unconstitutional legislative and regulatory process that led to approval of a large natural-gas burning plant in Asheville and appeal the certificate issued by the NC Utilities Commission.
The abuse of due process in the Asheville gas plant case is more proof that Duke Energy has too much control in North Carolina and that you, as Attorney General, must exercise your constitutional authority to police the corporation.
We continue to believe that you are obligated to investigate our October 7 allegations that Duke Energy is not meeting the requirements of its state-issued charter, its very permission to operate in North Carolina. Duke Energy is required to be subject to fair regulation by the Utilities Commission in order to operate as a monopoly in this state. As shown below, Duke Energy continues to act contrary to the interests of North Carolinians with respect to due process, fairness, consumer protection and climate change, and the Utilities Commission continuously fails to regulate the corporation accordingly.
The Commission’s recent approval of the natural gas plant in Asheville is the latest example of Duke Energy’s undue influence. We were surprised that your department did not participate in the proceeding even though it was extremely controversial and represents a cost to ratepayers of more than $1 billion. In the past, you have exercised your discretion to stand up for the public in rate cases and other proceedings. This case is even more critical to the future of our state and calls for your office’s leadership.
The legislative and regulatory process leading to the Asheville plant’s approval were a mockery of good governance. Duke Energy caused a bill to be put forth and passed by the legislature, the Mountain Energy Act, which allowed it to short-cut the long-established regulatory process for earning approval for a new power plant. As the Act was applied by the Commission, the expedited review and lack of an evidentiary hearing violated due process and therefore was unconstitutional. A forty-five day review period is apparently unique in the United States, and it is simply not long enough for review of a proposal as technical and significant as a $1.1 billion power plant combined with the decommissioning of two coal-burning units and remediation of coal ash storage facilities.
Using a narrow interpretation of the Act as cover, the Commission shielded Duke Energy and its proposal for the Asheville gas plant from public scrutiny by refusing to use its discretionary authority to slow down the fast-track process. The Commission denied requests for an evidentiary hearing and, as a result, there was no opportunity for testimony and cross examination of Duke Energy officials and experts presented by other parties. The Commission set forth a timeline for proceedings before the application was even submitted, with a single public hearing scheduled for January 26, 2016, only five business days after Duke Energy filed its application. Members of the public who chose to testify did not have enough time to evaluate Duke Energy’s lengthy application prior to the hearing, much less to review the input from intervenors and their experts.
At Duke Energy’s request, the Commission further denied appeals to make critical information about the proposal available to the public. The information hidden by Duke Energy included critical details such as a broad, non-specific breakout of capital cost estimates and projections for fuel costs for the plant. When Duke Energy failed to make more than a cursory effort to validate why the information should be kept confidential, the Commission itself stepped in and wrote extensive and unlikely anecdotal arguments as to why Duke Energy could keep the information sealed.
Why did the regulator do the heavy lifting for the regulated corporation instead of erring on the side of transparency and the public interest?
Regarding the Commission’s Public Staff, we question whether it represented the using and consuming public in this case. Its recommendation went along with Duke Energy’s proposal almost entirely, after declining to advocate for more openness on behalf of the public or intervenors.
Throughout this process, intervenors made valid arguments supported by prominent experts against the need for the new Asheville plant, its climate impacts, and its economic risks, and in support of alternatives such as making use of a glut of power supply in Duke’s service areas and across the region. Meanwhile, Duke’s justifications for the project remained superficial, as if the corporation were confident that it need not bother to prove its case, as if it were protected by the constraints imposed by the legislature and Commission.
Duke Energy’s projections for growth in the Western North Carolina region were unrealistic and unsupported by any form of independent analysis or credible data. The purported transmission constraints requiring a new plant be built in Asheville had simple solutions, which were ignored by Duke, the Commission and its Public Staff. Duke was never required to address the objections of intervenors nor the tremendous gaps in its application – both the corporation and its proposal were completely shielded from scrutiny.
On March 1, 2016, the Commission issued a “Notice of Decision,” an abbreviated order to meet the arbitrary expedited review process in the Mountain Energy Act. The notice did not include any findings of fact or discussion about the concerns of the public or interveners. It appears the decision to approve was made before the Commission had sufficient time to analyze all of the consequences and alternatives to the project.
We are concerned that the secretive, fast-track process established in the case of the Asheville plant will be sought by Duke Energy in the General Assembly for future natural gas projects. The case has broad implications; it is the beginning of Duke Energy’s plan to build up to fifteen large natural gas plants in the Carolinas by 2030. Duke Energy’s plans for a massive switch to fracking gas would be disastrous for the climate crisis because methane emissions have become an even more significant driver of the current rate of global warming than carbon dioxide. Furthermore, locking our state into natural gas is a high-risk economic gambit because future fuel supply is likely to drop, leaving ratepayers susceptible to costly price spikes and possible shortages.
Again, these issues, as well as the clear lack of need for the new Asheville plant, were addressed in depth by NC WARN and other intervenors, and supported by affidavits of prominent technical experts. But it is quite apparent that neither the Public Staff nor the Utilities Commission considered them before approving Duke’s application.
As we highlighted in our Emergency Complaint, the Commission has a history of siding with Duke Energy in a number of ways, including approving the utilities’ long-range plans (IRPs) year after year with little scrutiny. It denies requests to hold evidentiary hearings on the proposed plans, and last year, the Commission further abbreviated its approval process by disallowing outside intervenors to enter the process or submit comments. This is critical because Duke Energy then uses the IRP as a key argument for building new plants like the Asheville project.
Your lack of response to the October 7 Emergency Complaint is disappointing. We met with members of your staff in December and then heard nothing until two weeks ago, when one of your staff informed us informally that you are not treating the complaint as a legal proceeding and will not respond to the legal arguments in it.
Duke Energy’s increasing control over North Carolina is far too important to be pushed aside simply because it is controversial. This state is yearning for leadership. We again urge you to exercise your duty, as Attorney General, to protect North Carolinians from abuse by monopoly corporations and accelerating climate crisis.
Therefore, we urge you to:
- Investigate the allegations in our Emergency Complaint. If you have already made a decision, we would like to have your written determination on the facts and allegations; explain why you might believe Duke Energy is not in violation of its corporate charter as we have detailed.
- Challenge the unconstitutional process that resulted from the Commission’s execution of the Mountain Energy Act and appeal the certificate issued for the Asheville gas plants.
Jim Warren, Executive Director
John D. Runkle, Counsel for NC WARN
CC: Beloved Community Center
Black Workers for Justice
Climate Voices US
Communication Workers of America Local 3607
NC Climate Justice Summit
NC Environmental Justice Network