May 13 Webinar: Information on Duke Rate Hikes

Summary: NC WARN’s Executive Director Jim Warren and Legal Counsel John Runkle will lead this webinar on the rate hikes Duke Energy has requested that would make families, small business and local government foot the bill for new power plants we don’t even need. NC WARN has developed another option, one that provides clean affordable energy while creating jobs. Click here to view and listen to the webinar.

Upcoming Webinar: How to Tell a Compelling Story

When: To be scheduled soon

Summary: Use what you learn to speak out for the real public good at the upcoming NC Utilities Commission public hearings on Duke Energy’s requested rate hikes:
Franklin: May 21, Marion: May 22, Winston-Salem: June 19, Charlotte: June 26, Hillsborough: July 2, Wrap-up press conference and rally: Raleigh, July 8

For more information on the Duke Energy rate hikes, visit our Take Action page and the NC WARN rate hike page.

The impact of energy costs on the affordability of housing

Energy efficiency is an especially important issue here in North Carolina as our electricity marketplace is rapidly changing. Duke Energy is now the main supplier of electricity for millions of North Carolinians. In addition to acquiring the customers of Progress Energy, Duke Energy has requested a rate increase from the NC Utilities Commission.

In light of these changes, the North Carolina Housing Coalition feels it is important that we extend our advocacy work to energy efficiency. I spoke last week at the Duke Energy shareholders meeting in Charlotte about the importance of energy efficiency to affordable housing. Below is an excerpt of my statement.

We believe that every person deserves a safe, decent, affordable place to live. Two million North Carolinians live in substandard housing or housing they cannot afford. This precarious affordability is continually threatened by high electricity bills. Duke has a residential shutoff rate of 10% per year in North Carolina. That means that thousands of families, who are already living paycheck to paycheck, are being asked to choose between their basic food and shelter needs and electricity.

The simplest and most economical way to keep energy costs affordable for low to moderate income families and people on fixed incomes is to invest in energy efficiency. Duke’s Integrated Resource Plan (IRP) calls for the company, by 2032, to invest only 2.5% of its retail sales in energy efficiency. That is simply not enough. Duke can avoid the need to build expensive power plants, and add unnecessary costs to its rate base, by investing in programs that help ratepayers reduce their energy usage. In other states where ratepayers have choices for their energy needs, Duke is investing heavily in energy efficiency. Clearly, Duke knows that energy efficiency is what ratepayers need and that it’s still possible to make a profit while investing in energy savings. Why not invest in those same programs in North Carolina rather than asking for even higher rates?

Duke has been very creative in fashioning special rate plans for industrial customers – especially in the company’s race to make North Carolina the preferred location for data centers. In some cases, industrial data centers pay one-third the price for electricity that families do. These very advantageous discount rates are only offered to industrial customers and are not available to residential customers. Meanwhile, thousands of low income families and seniors on fixed incomes watch their housing costs increase every year as their electric rates continue to go up. If successful, Duke’s current rate increase would mean that North Carolina household rates would be 30% higher than in 2009. Why not offer a special rate program for low to moderate income ratepayers in North Carolina?

Duke’s business plan is not in the best interest of the ratepayers of North Carolina. Asking low income ratepayers to pay more for their electricity is a regressive model that increases housing costs for individuals and families who are already in dire straits. North Carolina families deserve better.

Satana Deberry
Executive Director
North Carolina Housing Coalition

AARP Statement

With the takeover of Progress Energy, Duke Energy Corporation is now the largest electricity provider in the U.S., with more than 7 million customers in 6 states. Duke is large and profitable, but continues to ask too much of its customers, many of whom are still struggling economically.

The North Carolina Supreme Court got it right in its recent decision when it said that ratepayers must not be a mere afterthought when setting utility rates and utility profits. AARP, which surveys and serves those ages 50 and above, has found high utility costs to be one of the biggest challenges for our members in this state. North Carolinians need affordable energy now. We believe that utilities can be profitable while still considering the needs of its customers. Duke is very committed to economic development and gives deals to large employers. But what about the workers who are burdened with excessive rate increases?

The current rate cases in North and South Carolina shows this disparity. In North Carolina rates would increase by $446 million, increasing overall revenues to Duke North Carolina by 9.7%. But for residential customers, the percentage increase is higher—11.8%, or more than $14 per month for a customer using 1000 kwh. That includes at $4.47 increase in the basic facilities charge (BFC), which hits lower usage customers hardest. It will now cost consumers more than $14 each month before they ever turn on a light. The pending South Carolina rate case is as lopsided for residential customers. There a $220 million/15% overall rate hike, will be a 16.3% increase for residential customers, or nearly $18 more each month for a customer using 1000 kwh.

Last year at this meeting AARP complained about the high rate of return on equity that was included in a settlement of the last North Carolina rate case. After Attorney General Cooper appealed that case, AARP submitted an amicus brief, or friend of the court brief, in support of the AG’s position. The court agreed with the AG and AARP—state law requires that the impact on consumers should be taken into account when setting the allowed rate of return on equity. Yet in the current rate cases Duke again ignores its customers, and seeks an increased ROE of 11.25% in both states. Duke deserves a fair rate of return, but not an excessive one. 11.25% is excessive in today’s market.

Duke should not be trying to get more from Carolina consumers to make up for setbacks in other states. Shutting down a nuclear plant in Florida, cost overruns at a coal gasification plant in Indiana, a recent rate case settlement in Ohio may have Duke management looking for revenues elsewhere. Don’t look here, consumers in the Carolinas are tapped out.

For older consumers, many of which are on fixed incomes, Social Security increases have not kept pace with the size of the rate increase proposed. Older consumers and those of low income pay a higher percentage of their income for electricity than do other households. With the seventh highest poverty rate in the nation, programs that provide energy assistance cannot keep up with the demand for assistance. Funds established by Duke Energy for further assistance are appreciated, but will only make a tiny dent in the true need.

For the past 20 years, AARP has been one of the only national advocacy organizations working at both the federal and state levels to help people save money on their utility bills. In these difficult economic times, we, along with our members, will continue to advocate on behalf of families struggling to pay their utility bills.

Patrick Cobb
AARP South Carolina

CHARLOTTE – Ratepayers and concerned North and South Carolinians gathered outside Duke Energy’s annual shareholder meeting here today to bring the voices of those impacted by the company’s rate hikes and dirty energy facilities to the meeting. Duke Energy, now the largest utility in the nation, seeks to raise electricity prices for millions of customers across North and South Carolina to pay for extending the use of obsolete and dirty power plants that threaten the health of people, the environment, and the economy.

Advocates are calling on Duke Energy and state policymakers in the Carolinas to more fully embrace clean energy production which would create additional permanent high-tech and manufacturing jobs while promoting clean air and clean water.

Members and supporters of AARP, Greenpeace, NC WARN, the Sierra Club, and others presented a 9’ x 16’ display wall with hundreds of photos taken by Duke Energy customers to demonstrate their opposition to rate hikes for dirty fuels.

“Duke’s investors should know that ratepayers will not be satisfied until the company embraces a clean energy future that will protect our climate, our pocketbooks, and our health,” said Greenpeace Executive Director Phil Radford.

Clean energy is growing rapidly across the United States and is replacing older coal-fired power plants. North Carolina is a regional clean energy leader in solar power, with more than one thousand companies and thousands of people employed in the solar energy industry. North Carolina also leads the Atlantic Coast with the greatest potential for offshore wind energy, yet Duke Energy is blocking the development of solar and wind in the Carolinas, instead generating the vast majority of its electricity from dirty fuels like coal, nuclear, and natural gas with no plan to change. In the Carolinas, Duke’s energy mix will include only 2.5 % wind and solar energy 20 years from now if the company sticks to its current business plan.

“Sierra Club members and supporters ask Duke Energy to support North Carolina’s clean energy economy by phasing out its remaining coal-fired power plants, like the Asheville Coal Plant, and replacing them with home-grown clean energy that builds our economy, cleans our air, and protects our most vulnerable citizens,” said Kelly Martin, campaign representative with Sierra Club.

North Carolina is a leader in the nation for the number of high hazard coal ash lagoons, many of which are operated by Duke Energy. Reports of toxic and cancer causing agents linking into drinking water sources from impoundment dams are becoming commonplace.

Sara Behnke, founder of We Love Mountain Island Lake, attended the shareholder meeting to question Duke Energy executives about coal ash contamination near its Gaston County coal-fired power plants in North Carolina.

“Realizing that I was living beside an active Duke Energy coal ash pond that is leaking toxins into our drinking water was a wake-up call for me,” Behnke stated. “My daughter Anna and I are speaking here today to let Duke know that we want a clean energy future and that we want them to accept responsibility for polluting our community and communities across their service areas.”

Seniors and others on fixed incomes, small business owners, and municipal governments are being squeezed as Duke Energy shifts costs from large commercial and industrial customers to those that can least afford it. Unfair and regressive rate schedules that penalize energy efficiency and conservation and double-digit, serial rate hike requests have become a business model that will cost new jobs.

Members from AARP in North and South Carolina were there to express their concerns over how residential increases impact fixed-income seniors. “Duke should not be trying to get more from Carolina consumers to make up for setbacks in other states. Shutting down a nuclear plant in Florida, cost overruns at a coal gasification plant in Indiana, and a recent rate case settlement in Ohio may have Duke management looking for revenues elsewhere. Don’t look here, consumers in the Carolinas are tapped out,” said AARP North Carolina Director Doug Dickerson.

One highlight of the half-day rally is a “State of the States” report by ratepayers from Duke Energy’s six service areas, Teach-ins on various forms of energy and fuel sources, and workshops on how to organize the growing movement around financial, environmental and social justice issues.

“It’s exciting to see people connecting the dots between climate change and the need to speak out about serial rate hikes for dirty energy. Having such a large diverse group of concerned ratepayers come together is truly inspiring.” said Connie Leeper, outreach organizer with NC WARN.

Participating organizations include AARP, Consumers Against Rate Hikes, Greenpeace, NC WARN, and the Sierra Club.

CONTACT:
Bill Gupton, (704) 367-0068, bill@consumersagainstratehikes.org
Monica Embrey, (773) 419-0963, membrey@greenpeace.org
Jenna Garland, (404) 281-6398, jenna.garland@sierraclub.org