Industry, governments, schools, are paying thousands for services they aren’t getting – a “double whammy” for workers and “financial cascade” for state economy
Manufacturers across North Carolina are seeking temporary power-bill relief for services not being received by a host of business, government and nonprofit facilities during the coronavirus crisis. Duke Energy’s response shows that the multinational corporation has little alliance to its home state even as many of its earliest customers are strapped by an unprecedented financial emergency.
With a wide range of facilities now using minimal if any electricity, Duke is reaping a windfall by charging them each month for services not being provided. A fight has emerged at the NC Utilities Commission, which is being urged to quickly respond to a petition filed by the Carolina Utility Customers Association (CUCA), which represents large manufacturers.
Large electricity users, including manufacturers and many commercial, government, educational and faith-based facilities, often pay half their monthly bill for a “demand charge” that’s based on their highest usage in previous months. This essentially pays for power plants that are on standby and used during periods of higher demand. If those large users are operating at a low level – if at all – they still pay Duke Energy a minimum monthly demand charge that can range to hundreds of thousands of dollars.
Duke claims that helping the bigger users would force smaller ratepayers to pick up the tab. NC WARN fully agrees with CUCA that other customers should NOT pay – and that Duke stockholders should absorb the reduction in revenue.
Duke claims it will lose $28 million in revenue if the demand charge is suspended. That’s only 0.7% of Duke Energy’s net profit in 2019 (nearly $4 billion). We agree with CUCA’s comments to the Commission, that “If Duke can award its top executive $15 million to operate a monopoly utility … it can also afford $28 million to keep NC manufacturers from real financial calamity” during the pandemic.
Without the temporary suspension, CUCA warns that companies going out of business will cause long-term power bills for others to rise, a blow to State tax revenues, and a “financial cascade due to the loss of business [that] will reverberate across all sectors,” and that workers losing their jobs due to the pandemic face “a double-whammy of lost wages and higher energy bills.”
We agree that Duke should have an interest in ensuring that manufacturers aren’t driven out of business by the pandemic and associated financial crisis.
CUCA points out that Duke Energy spends lavishly among state legislators to advance its political goals, “but it doesn’t want to help struggling manufacturers.” They cited an article revealing that Duke made $300,000 in campaign contributions to advance last year’s SB 559, a $20 billion ratepayer rip-off that NC WARN and a host of allies defeated.
CUCA points out that the Charlotte-based giant ranks among the nation’s worst utilities for customer satisfaction among businesses and households. It told the Commission “… Duke has put its own interest ahead of its struggling customers … [which is] short-sighted and harmful to the State of North Carolina.”
U.S. courts have granted corporations “personhood.” But persons have hearts – and brains. For Duke Energy leaders to double down against so many people facing bankruptcy and other hardships is appalling. They’re able to do it only because they operate a state-sanctioned monopoly that treats users of its electricity as captives.
It’s high time that our political leaders open North Carolina to energy competition.