Order comes as “worst-ever” scandal shows energy giant poured money onto state legislators in lead-up to ongoing, controversial energy bill
A ruling by the NC Utilities Commission is a partial win for NC WARN and Friends of the Earth in a case seeking to stop Duke Energy from charging ratepayers for spending to buy influence, stifle criticism and mislead the public. Thursday’s order came just as political corruption expert Bob Hall released a stunning analysis showing Duke executives and board members spent record millions in the lead-up to a major energy bill that’s been fought over for months in Raleigh.
In response to a 2018 petition by the partner nonprofits, the commission issued rules explicitly prohibiting Duke Energy’s two utilities from charging ratepayers for lobbying, image-polishing propaganda, well-aimed philanthropy, political giveaways and other means to buy favor and distort public debate.
NC WARN says that, in rate cases, Duke Energy consistently tries to slip millions of inappropriate influence dollars past regulators. In the future, the utilities must provide proof that it doesn’t seek to charge ratepayers for influence spending.
The commission denied a request to establish stiff financial penalties if Duke tries again to charge influence spending to ratepayers, saying it already has authority to assess such punishment. The commission also said protections already exist for some other measures sought by the two groups, such as expanding the state’s definition of utility lobbying to match the federal definition.
In the emerging legislative scandal, the Energy News Network reports Bob Hall’s findings that Duke Energy has been “pouring money into state politics like never before” over the last 18 months. His analysis also shows that Duke’s two NC utilities spent over $50 million last year in advertising, donations and “Certain Civic, Political and Related Activities,” totals far above those of previous years.
Hall called the millions a part of Duke Energy’s political operation “aimed at protecting their status as this very special creature: a so-called regulated monopoly.” That operation includes using front groups and advertising to smear legislators who don’t show loyalty to Duke, seemingly a “coordinated effort” in the months prior to the fight over HB951.
NC WARN and other critics say Charlotte-based Duke ranks as the nation’s worst climate-polluting utility, and that HB951 would help lock in its plans to build over 50 gas-fired units in the Carolinas even as the world’s climate scientists insist that power plants using natural gas (methane) must be rapidly phased out.
“Influence spending by energy corporations is a national epidemic that is polluting our democracy and driving the climate crisis,” Michelle Chan, Vice President of Programs at Friends of the Earth, said today. “State regulators must do all within their power to stop Duke Energy from further corrupting North Carolina’s decision-making.”
NC WARN calculated that Duke Energy uses more than $80 million annually in the Carolinas to buy favor, distort its corporate record and mute criticism of its massive gas expansion, which includes the ongoing construction of a controversial gas storage facility in Robeson County. Hall’s new analysis signals the spending could be even higher because Duke has been able to hide “different buckets” of spending.
The 2018 petition detailed how virtually all the influence spending originates from customer bills, and how Duke Energy uses an “accounting fiction” to claim that its stockholders or employees pay for the various influence expenditures. The commission earlier ruled against petitioners call to ban that spending, an area that could go to the NC Court of Appeals.
Attorneys with the Center for Biological Diversity assisted with the original petition and later directly intervened in the case, as did Hall. The former chair of the New York Utilities Commission, Peter Bradford, filed an affidavit urging the NC commission to take the lead in reining in the “long-running national problem of utility influence spending.”
Jim Warren, NC WARN’s executive director, said today, “Duke Energy leaders’ buying off our politicians and deceptive propaganda grow more appalling all the time – especially as the accelerating climate crisis repeatedly devastates North Carolina communities. Kudos to Bob Hall for exposing Duke Energy’s worst-ever scandal.”