A bill backed by Duke Energy that would change the way North Carolina regulators set electricity rates cleared the Senate Thursday on a bipartisan 27-21 vote.
Senate Bill 559 heads now to the House for more discussion. It would allow the North Carolina Utilities Commission, which reviews the company's requested rate increases, to approve increase plans up to five years ahead of time instead of going through the lengthy annual reviews used now.
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Proponents have stressed that the bill simply gives this power to the commission, a seven-member board appointed by the governor with General Assembly confirmation. It doesn't require the multi-year plans.
But dozens of companies, including some of North Carolina's largest employers and energy users, oppose the measure, fearing rate hikes. Environmental groups also are against the bill, as are consumer advocates who fear less opportunity for public input if multi-year plans are approved.
Duke has lobbied the bill hard, and the bipartisan sponsors are some of the most powerful leaders at the legislature.
The bill has two sections: One changing the way utility companies raise money to pay for storm repairs and another with the multi-year plan language. The storm repair section hasn't been controversial, but bill sponsors have resisted repeated efforts to split the bill in two and let each section rise or fall on its own.
They did so again Thursday, defeating one effort on the Senate floor to divide the bill and another to study multi-year plans and other rate-making methods instead of implementing the change. Those amendments were offered by Sens. Harper Peterson, D-New Hanover, and Mike Woodard, D-Durham.
Thursday's vote was bipartisan, but more Democrats voted against the bill than Republicans, despite the fact that Senate Minority Leader Dan Blue is one of the lead sponsors. Blue, D-Wake, whose family law firm has done work for Duke's Atlantic Coast Pipeline project, and other bill sponsors pushed back against criticisms of the bill, saying complaints are borne of hyperbole.
Blue relayed an "ancient Indian philosophy" on the Senate floor, saying a man thought he walked into a cobra hanging from the ceiling in his hut one night but discovered in the morning it was only a rope. Blue and the bill's two other chief sponsors, Sens. Bill Rabon, R-Brunswick, and Ralph Hise, R-Mitchell, both members of Republican leadership, put out a joint statement after the vote.
"Current law requires the Utilities Commission to act in the best interest of the public," they said in the statement. "This legislation provides the Utilities Commission with the option of deciding whether the public interest is best served by, for example, short-term rates or longer-term rates. Thirty-five states already have some form of this policy. That’s it. The sky isn’t falling, the world isn’t ending."
Duke requested the bill after the Utilities Commission denied a couple of requested increases, one to cover future coal ash cleanup costs and another to fund planned changes to the state's electric grid. The commission largely backed the company's request to boost rates for coal ash costs already incurred but said it wouldn't OK increases for future costs.
Company spokespeople have said that, though the bill request followed those 2018 decisions, it wasn't because of them. Senators backing the bill have said they believe the commission already has the power to approve rate increases for future costs, but that since the commission didn't feel it could do so last year, the bill would clarify that it can.
The company's grid modification plan was once a $13 billion request over 10 years. Coal ash removal costs are estimated at another $10 billion.