Evidentiary hearing for Duke rate increase started this week 

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    Brittney Lofthouse – Staff Writer

    Just a month after dozens of residents filled a courtroom at the Macon County Courthouse to speak out against a proposed rate hike from Duke Energy Carolinas, a scene that was replicated all over the state, the North Carolina Utilities Commission (NCUC) began the evidentiary hearing in Raleigh and will soon decide whether or not Duke customers  in WNC will see an increase in their electricity bills this week.

    Duke Energy is requesting a rate hike which would increase the rate for residential customers by an average of 16.7 percent; 11.4 for commercial customers, and 9.9 for industrial customers. A typical 1,000 kWh residential bill would increase from $103.96 to $122.68 if the increase is approved. The request was made to help cover costs related to the closure and cleanup of leaking coal ash plants across the state.

    The public opposition to the rate increase proposal wasn’t centered around having to pay more for electricity, but was against the premise of the request to begin with. Duke Energy claimed the rate increase was needed to pay for the modernization of its electric system; to generate cleaner power through renewable resources; to manage and close its coal ash basins; to respond to major storms like Hurricane Matthew and to continue to improve service to its customers.

    “Duke Energy Carolinas made a request before the North Carolina Utilities Commission to adjust customer bills,” a statement from Duke during the public comment period in January. “Recent work to modernize power plants and generate cleaner electric, responsibly manage coal ash and improve reliability while enabling more options for customers is at the heart of this request to change customer rates.”

    Dozens of residents signed up to speak on the issue, all opposing the rate hike. While the majority of the residents were from Macon County, residents from neighboring counties such as Swain and Jackson also made the trip to Franklin to voice their opposition.

    Selma Parks of Franklin was one of the first to speak during the public hearing and said that as a resident of Macon County and on a fixed income, she, like so many others, can’t afford a rate increase. Parks said that Duke Energy customers shouldn’t be forced to pay more to cover the cost of the company’s mismanagement in the coal ash debacle.

    The NCUC will decide on the Duke Energy Carolinas rate increase in the coming days. Last week, the NCUC  only partially approved a separate request for Duke Energy Progress, the company’s utilities which includes the eastern part of the state and Asheville as a separate service area. That rate increase will impact Duke Energy Progress customers who live in Asheville and those is the eastern part of the state.  The Duke Energy Progress rate increase, which was partially approved, will not impact customers in Western North Carolina.

    Duke Energy Progress initially petitioned the state to charge customers an additional $477.5 million annually — a 14.9 percent increase. By the January public hearing, customers were commenting on a rate hike that had changed since the initial request and what Duke was actually seeking was confusing.  In September 2017, Duke revised its request, reducing the original $477.5 million increase to $419.5 million. The final proposal would increase the basic monthly customer charge for residential customers from $11.13 to $19.50. Last week, after listening to customers across the state, the NCUC approved only an increase in the basic customer charge to $14 for Duke Energy Progress, which cuts Duke’s revised $419.5 million revenue request by more than half.

    The commission heard the complaints across the state and were inclined to agree with customers. In addition to not approving the rate increase as requested for the purpose of cleaning up the coal ash mess in the state, the utilities commission imposed a $30 million management penalty on Duke based on its determination that the company’s handling of coal ash “placed its consumers at risk of inadequate or unreasonably expensive service.”

    In addition, the commission found that, “DEP admits to pervasive, system-wide shortcomings such as improper communication among those responsible for oversight of coal ash management.” The penalty will be paid for by Duke and not by Duke’s customers. The commission further found that Duke paid too much for coal ash removal at its Asheville coal-burning plant and, therefore, denied recovery from customers of an additional $9.5 million.

    Representative Kevin Corbin who spoke out against the Duke Energy Carolinas request in January said that he was hopeful that the NCUC’s ruling on the eastern part of the state’s rate increase will be something WNC customers see with the rate increase proposed for this area.

    “I am thankful that many people spoke out against both rate increases in the state in regard to the rate increase being too much at one time,” said Corbin, who was the only elected official to speak during the public comment period in January.  “Obviously the folks at the utilities commission are listening to our voices which is evident when they responded with a ‘less than half’ increase and a penalty for the company for Duke Energy Progress. We hope to see the same thing for the Duke Energy Carolinas proposed increase.”

    In addition to concerns regarding having to pay for the company’s coal ash spills, customers spoke out against the rate increase and said those on a fixed income can’t afford to pay for any increase. To address those concerns, the NCUC said additional dollars would have to be placed in Duke’s assistance programs to help out the low-income customers.

    The commission’s decision acknowledges that “the rate increase approved in this case … will be difficult for some of DEP’s customers to pay, in particular the company’s low-income customers.”

    As a part of the settlement approved by the commission, Duke will make a $2.5 million contribution from shareholder funds to the Helping Home Fund to be used for low-income energy assistance in Duke’s North Carolina service territory.

    Duke Energy Carolinas customers in WNC will know about the proposed increase in the coming weeks after the NCUC concludes the evidentiary hearing and announces a ruling in the case.

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