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Wednesday, 29 May 2013 13:10

Most oppose Duke rate increase and reliance on fossil fuels

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Most who spoke during a public hearing at the Macon County Courthouse on Duke Energy’s proposed rate increases were not pleased with the prospect of another uptick on their electric bills and lambasted Duke Energy representatives for wanting to use the increase to pay for recently built fossil fuel plants and pay higher dividends to investors.

 

The utility company is seeking an additional $446 million per year in revenue and wants to raise rates to get it. The public comments came during a hearing held by the N.C. Utilities Commission.

While many were content with Duke’s service as a utility company, most were opposed to paying more for that service. The proposed increases would translate to a 10 percent hike in electricity costs for all customers and a hike as high as 14 percent for residential customers.

“I like to have my beer cold; I like to have my food preserved; I like to read at night without going Abraham Lincoln — I appreciate having electricity,” said Jackson County resident Adam Bigelow, during his testimony in Franklin. “But I am asking the commission to not only deny the increase being asked here, but give no increase.”

Bigelow, like several others who testified that day, said he’d like to see Duke move toward more renewable sources of energy. Bigelow said he’d even be willing to pay extra for electricity if he knew it were clean energy — much like he is willing to pay more for organic food and bio-diesel fuel for his car.

“I would stand up here and say ‘Please, increase my rates,’” Bigelow said. “I would pay for that.”

But he doesn’t want to fund more fossil-fuel-based energy.

This is Duke Energy’s third request for an increase in the last several years. The company says 90 percent of this latest increase is needed to reimburse itself and its stakeholders for construction of gas and coal power plants recently brought online. The company is also seeking to increase returns paid to its investors.

The meeting last week in Franklin was the first of a series of meetings in which the commission will listen to expert testimony and regular residents on the proposed rate hike. Then, commissioners will make a decision by early fall on how much — if any — increase to grant Duke.

This latest round of hearings began just after the N.C. Supreme Court ordered the commission to provide further justification for approving Duke’s previous rate increase that took affect in February 2012. 

However, Duke officials say this latest rate increase is vital to providing reliable service and making essential upgrades to the company’s aging infrastructure. According to Duke Energy’s Nantahala Area District Manager Lisa Leatherman, the company has some of the best reliability rankings in the region and some power plants it is phasing out, in a costly upgrade process, date back to the mid-1900s.

The increased rates ensure the service stays reliable and Duke’s equipment and facilities are current with environmental standards, Leatherman said. And, when the increases are explained in that context, ratepayers are understanding, she said.

“The rate increase is about paying for the investments to serve our customers, for decades to come,” Leatherman said. “When I share with folks about an aging electrical system and increasing environmental regulations, they understand.”

But not David Waters, a retired electrical engineer from Franklin. He did not understand why the company would put the burden of rate increases on the backs of residential payers. If left up to him, Duke’s rate increases would undoubtedly be nil.

“It hits the poor and the middle class — it’s unconscionable,” said Waters. “I think it’s important that Duke Energy not raise the rates in North Carolina but rather eat it out of their own resources.”

One campsite manager who lives in Almond, Joe Deddo, said he paid about $1,000 for his power bill last July to provide electricity to his 30 campsites. It was his first summer in operation since the last round of Duke increases took effect in February, last year. He said he testified at the meetings regarding those rate increases as well.

“We were just here a year and a half ago,” Deddo said. And according to him, his economic situation hasn’t improved all that much since then. “It’s hard to make it.”

Two residents at the meeting gave favorable testimony of Duke, although both stopped short of supporting the rate increase. Sutton Bacon, CEO of the Nantahala Outdoor Center, applauded Duke for its partnership in providing prime whitewater releases from its dam above the Nantahala River and for making various boating improvements in the region, such as put-ins, riverside parks and wildlife observation areas. The company was required by federal regulators to do so as part of its license to use public waterways to generate electricity.

“None of this would be possible without Duke Energy and their support,” Bacon said. “I couldn’t ask for a better partnership with Duke representatives.”

Bacon’s rafting operation is one of the largest in the country and relies on Duke’s water releases to stay afloat.

Franklin resident Ken Murphy also testified as to how Duke has been helpful in working with him to put energy back onto the company’s grid. Murphy has a wind-turbine system as well as solar energy panels on his roof that allow him to supplement his electrical needs using a special two-way meter.

Murphy said Duke staff has supported his green energy ventures.

“Duke Energy not only talks the talk, but it walks the walk,” Murphy said.

However, another Franklin resident Bill Crawford feared Duke and other energy companies liked the publicity surrounding green energy and renewables but were unwilling to heavily invest in them on a large scale. He saw the recent completion of Duke’s new coal and natural gas plants as evidence to that. He feared the rate increase might be enabling the company to continue down the path of fossil fuels and that contribute to global climate change.

Yet, he did identify a silver lining in the increase.

“I’m torn on the rate increase,” Crawford said. “If raised, the rate hike might slow consumption of electricity.”

Four of the six members of the N.C. Utilities Commission attended the meeting in Franklin and listened to the testimony given. Commission Chairman Edward Finley said the testimony was much like the other public hearings for prior rate increase cases. He has been on the commission for about six years.

“People are concerned about the economy and their ability to pay the rates, and people are concerned about the fossil fuels,” Finley said. “We have heard that testimony often in the past and are not surprised to have heard it tonight.”

Commissioner Bryan Beatty would not go as far as to say that the testimony was necessarily anti-Duke. He claimed people were just speaking the truth about how the rate changes might affect them.

“I wouldn’t describe it as anti-Duke,” Beatty said. “I would simply say they are expressing their economic situations and talking about the economic situation of their friends and neighbors.”

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