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UtilitiesNC Policy Watch followers will recall that last week we reported on a an recent and egregious giveaway to big utility companies in which the North Carolina Utilities Commission pulled a mysterious and unforeseen rabbit out of a hat to reverse its own previous ruling from earlier this year.

The case revolves around whether all of the 2013 tax cuts enacted by the General Assembly and Governor McCrory should be accounted for when it comes to computing the rates that regulated monopolies like Duke Energy are allowed to charge ratepayers. In May, the Commission ruled by a 6-1 vote that they must.

A few months later, however, in an abrupt and apparently unprecedented move, three McCrory appointees to the Commission changed their minds and signed on to a new opinion by the Commission chair, Ed Finley, in which the May ruling was summarily reversed and the “exceptions” (i.e. the appeal) submitted by two of the power companies upheld. Parties in the case were not even given a chance to submit arguments on the question.

According to the new majority, the cut to the state’s corporate income tax should not be factored into rates and companies should be free to keep the windfall if they like. According to the three overruled commissioners:

“The Majority’s decision, rescinding, in part, the Commission’s May 13, 2014 Order in this docket, allows the utilities to charge ratepayers in perpetuity to collect for taxes that the utilities no longer pay. The Majority’s decision errs with respect to fairness to ratepayers; errs procedurally with respect to due process and the limitations of the Commission’s right to rescind, alter, or amend an Order; and errs in its content with respect to its legal conclusions.”

As it turns out now — perhaps because of the adverse publicity here and elsewhere — most, if not all of the big utilities are now saying they will not keep the windfall.

This is good news for consumers but it should not be the end of the story. Even if the utilities are too embarrassed to keep their unearned money, the Commission majority’s heavy-handed action was and is still unacceptable and sets a terrible precedent — both with respect to substance and procedure.

Let’s hope that both the Utilities Commission Public Staff and Attorney General Roy Cooper stick to their guns, appeal the matter to the state judiciary and secure an order vindicating the rights of consumers ASAP.

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Some giant corporations complain about and battle government. Others try to co-opt and corrupt it. In the case of Duke Energy, one gets the distinct impression that the ever-mushrooming Charlotte-based monopoly will simply absorb North Carolina state government at some point and turn it into its Raleigh branch.

Fortunately, some intrepid consumer advocates are still giving Duke heck for the heck it continually visits upon residential ratepayers and our ever-more-fragile natural environment. Here’s their press statement from earlier this week on the occasion of a public hearing in Charlotte (the actual Utilities Commission proceedings begin Monday July 8 here in Raleigh — be on the lookout for more information):

Broad Coalition of Ratepayers Calls for Rejection of Duke Energy Rate Hike
Rate case opposed for environmental, social justice and financial reasons

Charlotte, NC.  A broad coalition of organizations and dissatisfied ratepayers will gather this evening at the Mecklenburg County Courthouse to call on the North Carolina Utilities Commission to reject the proposed Duke Energy rate hike and a settlement proposed by the Commission’s Public Staff. The coalition’s opposition is based on environmental, social justice and financial reasons. Read More

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As noted here yesterday afternoon, one of the bills still residing on Governor Perdue’s desk is a controversial proposal that would set the table for a hostile takeover of the city of Asheville’s $173 million water system (and perhaps, full-blown privatization of the public system).

Last night, the Asheville City Council voted unanimously to ask Perdue to veto the bill.

According to an article in the Asheville Citizen-Times:

“Members debated whether a gubernatorial veto would stand up and whether it is worth losing another provision of the bill that would protect the city’s seats on the MSD board in the event the agency merges with a Henderson County sewer system.

But they ultimately came around to the position of Mayor Terry Bellamy, who said Council should underline its opposition to a transfer.

‘I don’t support (the bill) and I don’t believe it was written fairly,’ Bellamy said.

This opens the door for our system and other systems around the state’ to be tampered with by the legislature, she said. ‘I don’t think we should take this and let it go. I don’t think this is right.’”

 

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Governor Perdue still has a few bills sitting on her desk that were sent to her during the waning days of the legislative session. One of them is a measure that’s vehemently opposed by a broad range of groups and individuals in western North Carolina.

The proposal, which  was advanced from scratch during the last couple weeks of the session by Buncombe County lawmaker Tim Moffitt, raises the explosive issue of forcing Asheville to transfer its $173 million municipal water system to the local Metropolitan Sewerage District.

Though the bill itself would not force such a transfer right away, it does appear to lay the groundwork for such a move and, perhaps ultimately, privatization of the system (and maybe other public water systems as well).

Reports indicate that the Asheville City Council will be discussing the issue this evening. It will be interesting to see if Council tries to weigh in with the Governor before her deadline for action at the end of this week.

 

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There are at least a couple of thoughts that occur this morning in wake of the latest news about Duke Energy’s acquisition of (sorry, merger with) Progress Energy (née CP&L):

#1 – While some in the mainstream news media (and the Utilities Commission Public Staff) seem surprised that former progress chief Bill Johnson (right) has now been muscled out of the way and given a platinum parachute by the big Monopoly game winner Jim Rogers (left), my first reaction was: How could you not see this coming? Fat cat, empire-building CEO’s like Rogers are not about sharing power; they’re about winning it and grabbing more. The bottom line here is that Rogers came to this game with more weapons and almost certainly always intended to emerge “victorious.” All the public talk about cooperation and merger were almost certainly p.r. bull.

#2- And as for Johnson, Read More