Both Duke Energy Progress and Duke Energy Carolinas are asking the NC Utilities Commission for rate hikes in 2020. Hearings are over but the Commission has not yet issued an order. Below is some information on what Duke requested and the issues NC WARN raised in its testimony.
Duke Energy Carolinas (just scroll down a tad)
Duke Energy Progress
Duke Energy Carolinas
Duke wants people to think this is a 6.7% residential rate hike, but Duke is actually seeking an average 10.3% increase for residential accounts. The lower 6.7% figure is the net increase after Duke pays customers back for overcharges related to tax savings that it failed to pass on to us in previous years. (See page 18 of Duke’s filing with the Utilities Commission.)
Unnecessary Grid “Improvement” and Inefficient, Stealthy Gas Expansion
NC WARN’s testimony was prepared by engineer Bill Powers and argues that the Utilities Commission should reject billions in grid “improvements” and unapproved gas expansions that maximize costs and climate pollution.
NC WARN argues that Duke is trying to pad investors’ pockets through pre-approval of grid projects that are either unneeded or could be better handled with solar-plus-storage investments. In addition, expert witness Bill Powers shows shows that Duke has been quietly building new gas-burning capacity at existing coal-fired power plants in a way that maximizes both greenhouse gas emissions and the cost of the electricity.
Power testifies that both the grid scheme and gas additions should require open scrutiny by the Utilities Commission and other interested parties prior to construction. The proposed grid “improvement” plan – which Duke hopes to scale up to at least $13 billion over time – has repeatedly failed to gain regulatory, legislative or public support since 2016.
Meanwhile, Duke has been building the large “dual-fuel” gas projects at its Cliffside and Belews Creek coal-fired power plants under the radar, and plans to do more at Belews, a facility in Stokes County. Duke is spending hundreds of millions to allow the option of having gas heat the steam boiler now fueled by coal. As Powers explains, such generation is even less efficient than burning coal, causing much higher gas usage to generate the same power as in modern gas-fired plants, higher greenhouse gas emissions than burning gas in modern plants, and the highest priced electricity on Duke’s system except for short-term generation from peaking power plants.
If Duke were building an entirely new gas plant, it would have to prove it’s the least cost option, which it clearly is not. But since the projects are adding gas-burning capacity to existing plants, Duke argues that this is not “new generation” and therefore does not require a Certificate of Public Convenience and Necessity (CPCN). A completely new plant would require a CPCN, which would involve hearings before the Utilities Commission. Thus, Duke is able to pursue its massive gas expansion with virtually no public or regulatory oversight.
In this rate case, Duke Energy once again claims it wants to prepare the power grid for a future of distributed renewable energy (at homes, buildings, parking areas, etc.). However, national evidence shows that most of the grid work Duke proposes wouldn’t help get us to a distributed energy future anyway. Instead, Duke wants high-dollar projects that raise rates but aren’t needed.
Finally, Duke Energy appears to be seeking pre-approval of future grid investments, a major change in state law that NC WARN is vigorously opposing.
Find more details on Duke’s grid plan in our news release about Bill’s testimony.
Coal Ash Negligence
Duke is again seeking to make customers pay for coal ash cleanup. This was granted by the Commission in the last rate case, but is being challenged in the state Supreme Court by Attorney General Josh Stein.
Insurers refuse to cover coal ash liabilities because, for years, Duke failed to take reasonable measures to avoid or mitigate damages from coal ash disposal. Coal ash costs could total $10 billion over time, and over a half-billion in this rate case alone. In addition to seeking reimbursement of actual expenses, Duke wants ratepayers to provide a 10 percent mark-up (more or less “profit”) for its corporate negligence.
In every rate case, Duke Energy seeks reimbursement for millions spent to buy influence, stifle criticism and mislead the public about its corporate practices. In response to a legal petition filed by NC WARN and Friends of the Earth, the Commission is proposing firm rules to limit Duke’s ability to force ratepayers to fund such spending.
Duke Energy Progress
Under DEP’s proposal, customer bills could increase as much as 14.3%.
Duke bosses want to force power users to pay for expanding their climate-wrecking fracked gas operations including the new Asheville gas plant, for their coal ash negligence (including a profit!) and for completely unnecessary “grid improvement” projects that serve only to boost Duke profits.
Fracked Gas Expansion
In this rate case, Duke is seeking to recover the cost of building a natural gas-fired power plant at its Lake Julian facility near Asheville, along with an approximately 10% profit. Many of you fought with us against this plant in 2016. Unfortunately, it was approved and is now operating. But it’s still a terrible idea that Duke customers should not have to pay for.
Coal Ash Negligence
Duke’s insurers refuse to cover coal ash liabilities because, for years, Duke failed to take reasonable measures to avoid or mitigate damages from coal ash disposal.
Coal ash costs could total $10 billion over time. In addition to seeking reimbursement of actual expenses, Duke wants ratepayers to provide a 10 percent mark-up (more or less “profit”) for its corporate negligence.
Attorney General Josh Stein agrees with us that Duke Energy shareholders, not customers, should bear the cost of coal ash negligence; his appeal in a previous Duke rate case is awaiting a decision by the NC Supreme Court.
For three years, Duke Energy has tried to get legislators and regulators to approve a deceptive scheme to supposedly “modernize” its transmission grid: power lines and equipment. (The latest failed attempt was last year’s “ratepayer rip-off bill.” Thanks for helping defeat it.) This is part of a national utility effort to put billions into electricity rates. Duke wants to spend at least $13 billion in the Carolinas.
In the current rate case, Duke is proposing what appears to be another backdoor approach to spend billions on unneeded grid projects. The proposal remains vague, but Duke once again claims it wants to prepare the grid for a future of distributed renewable energy (at homes, buildings, parking areas, etc.). However, Duke’s own 15-year plan shows that the corporation does not plan to increase renewables beyond 8 percent of its total generation in the Carolinas (which is less than the current national average).
National evidence shows that most of the grid work Duke proposes wouldn’t help get us to a distributed energy future anyway. Instead, Duke is proposing high-dollar projects that raise rates but aren’t needed (such as under-grounding power lines).
Largely, that’s because advances in renewables, paired with battery storage, are set to leap-frog all that grid expense, and it’s a faster, cheaper and better way to get to a distributed and more resilient energy system. We should be equipping buildings and homes with solar+storage instead of pouring billions into an electricity grid system that’s moving toward obsolescence.