NC utilities legislation threatens regulatory integrity and consumer protections

Yahoo

14-05-2025

(IStock photo courtesy of JPM Strategies)
Two of the country's largest investor-owned utilities are waging a multi-state strategy to get more generating plants built at great expense to customers in the Carolinas. Duke Energy and Dominion, who operate in North Carolina are pushing utility-friendly legislation in Senate Bill 261 — now pending in the North Carolina General Assembly — which would fundamentally change the regulatory approval process. If it passes, North Carolina ratepayers will be required to pay much higher utility bills for decades to come.
If adopted, SB 261 would allow these utility companies to charge their electric customers upfront for the costs of building new plants. You might remember that this practice resulted in dire consequences in South Carolina where ratepayers are still paying for the failed VC Summer nuclear plant.
Here's how it worked: To pay for VC Summer, the utility company SCANA was allowed to charge its ratepayers using something known as 'Construction Work in Progress' (CWIP). That's what they call the setup where customers pay all the upfront costs to build a new power plant. The entire financial burden and the risks were placed entirely on customers and none of it on utility shareholders. When the VC Summer plant finally went belly-up, SCANA and Westinghouse both declared bankruptcy, SCANA executives were prosecuted and a few even went to jail. Guess who was left holding the bag for the $9 billion failed power plant that never was completed? If you guessed 'ratepayers' then you'd be right!
Is this the path North Carolina wants to take?
As a former member of the South Carolina Public Service Commission, I fear that history will repeat itself in North Carolina. These utilities should not be allowed to circumvent the normal regulatory process. My hope is that the North Carolina legislature will keep its longstanding regulatory process in place. It's worked well for years for North Carolina's large manufacturers, small businesses and residential ratepayers.
The North Carolina Utilities Commission and the commissioners who serve on it are currently required by law to look out for the best interests of everyone in the state who pays a power bill. Legislative changes that would undermine their ability to do their job should be soundly rejected.
Our existing regulatory process was put in place to protect consumers from utility monopolies who are motivated to increase profits for their shareholders. That is why the North Carolina legislature should continue to rely on the state's utility commissioners who possess the integrity and impartiality to be fair to all parties.
Don't make the mistakes that the South Carolina legislature made years ago by passing a law known as the Base Load Review Act. Our South Carolina ratepayers are still paying for those mistakes every month when those utility bills arrive in the mail. Sadly, our ratepayers are now stuck with those high rates for decades to come.
Neighbors are supposed to look out for each other. Your neighbor to the south is warning you that trouble is on the way in Raleigh unless North Carolina senators and House members say 'no' to the approach spelled out in Senate Bill 261.
Fortunately, it's not too late for North Carolina senators and representatives to rethink and reject this approach. You can learn more about the bill and how to communicate with your legislators by clicking here and here.