Rate-hike opponents want Duke Energy’s Cliffside plant halted
John Downey
Senior staff writer
A coalition of health, social justice and environmental groups has called on state regulators to reduce a proposed 12.6% electric rate increase for North Carolina by halting construction at Duke Energy’s Cliffside coal plant.
The groups, ranging from Appalachian Voices to Western Carolina Physicians for Social Responsibility, contend that the $1.8 plant expansion is unnecessary.
“There is no doubt that building new power plants … will continue to increase our rates much more than by using energy more efficiently, increasing co-generation, and deploying renewable energy,” the groups say in a letter delivered Tuesday to the N.C. Utilities Commission. “Duke Energy’s own data shows new plants can be avoided by modest increases in energy efficiency and with renewable sources of energy at levels already required in North Carolina.”
Duke spokeswoman Paige Sheehan defends the proposed expansion at Cliffside as vital for Duke and its customers. She says the company needs to modernize its fleet. And she says the increased capacity remains necessary for meeting future increases in demand.
She also says Cliffside accounts for less than 20% of the proposed increase. She points out that Duke will not begin recovering the construction costs until after the plant starts operating in 2013.
What Duke seeks to collect for Cliffside now is up to $600 million in financing costs. Energy legislation adopted by the N.C. General Assembly in 2007 allows utilities to recover those financing costs as a plant is being built.
And it is not clear how much could be cut from the proposed rate hike, even if Cliffside were abandoned. Under the 2007 legislation, Duke could still be allowed to recover the financing costs it already incurred. Duke has spent about $1 billion of the expected $1.8 billion total construction costs. So those financing costs would still be considerable.
The groups raise several other objections to Cliffside. They worry about the effects of mercury pollution and the impact carbon emissions have on global warming.
But much of the argument centers on the financial impact on ratepayers and the way the current recession has slowed demand. That slowing and the energy-savings potential in Duke’s Save-A-Watt initiative essentially eliminate the rationale for building Cliffside, they contend.
Sheehan says the rate case is not the place to debate a need for Cliffside. “That debate has already been held in one of the most robust hearings (before the commission) ever in the state of North Carolina,” she says.
The commission found proceeding with the plant is prudent, given Duke’s ongoing requirement to provide energy to its customers.
The groups do not agree. The list includes many of the groups who have opposed the Cliffside expansion from the outset, and have mounted public protests in the past. They include the Carolinas Clean Air Coalition, the N.C. Waste Awareness and Reduction Network and the Canary Coalition.
Richard Fireman, a spokesman for the coalition, says the groups will have representatives testifying at six public hearings statewide that start next week. And members of the coalition also will make formal presentations of evidence at the commission’s main hearing on the rate increase. That hearing is set to begin Oct. 19 in Raleigh.
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Wednesday 09 September 2009 - 23:15:41
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