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News Proposed Duke Energy rate increase stirs public opposition

Scott Burns, pictured above, was the first citizen to testify against the proposed Duke Energy rate increases. Burns explained that the rate increase would unfairly impact the people who can least afford it, stating that the proposals are untenable. Photo by Chad SimonsMacon County residents and citizens from across the Western North Carolina region arrived at the Macon County Courthouse Wednesday night to offer their testimony on the proposed Duke Energy rate increases. A number of people spoke out at the judicial hearing, jumping on the opportunity to voice their concerns to Duke Energy representatives.

Last July, Duke Energy Carolinas, LLC filed an application with the North Carolina Utilities Commission requesting to increase its rates by approximately 15.2 percent. The latter percentage does not include impacts from riders and chargers that have been approved by, or are pending before the N.C. Utilities Commission. In conjunction with the riders and chargers, the rate request amounts to an approximate 17 percent increase.

Duke Energy’s representatives listen to citizen testimonies about the potential hardships that would result from the proposed 17 percent rate increase at the hearing Wednesday evening. The testimony will be presented as evidence before the NC Utilities Commission hearing following the last of the community public hearings. Photo by Chad SimonsThe N.C. Utilities Commission later issued an order suspending the company’s proposed rate changes for a 270 day period, which ultimately led to the public hearing process. A total of 30 people signed up to testify Wednesday night at the county’s courthouse, and their testimony will be used as evidence by both parties in the case later this year when a final decision on the issue will be made.

Fred Alexander, Duke Energy’s District Manager in Western North Carolina, spoke on behalf of the company to begin the hearing. “With a down economy it might be hard to see that this rate request is also about keeping North Carolina, including Southwestern North Carolina competitive, but it is,” said Alexander. “In today’s high tech world it is essential that manufactures, computer facilities, and other enterprises have a reliable power supply.”

Duke Energy’s District Manager, Fred Alexander, was the first person to testify at the judicial hearing Wednesday night. Alexander discussed the reasoning behind the company’s rate increases, which he thinks are necessary for making the region competitive economically. Despite the rate increases, Harold says the company’s energy rates are still below the national average. Photo by Chad SimonsAlexander further opined that the rate increases are justifiable because superior service is vital if the region is to remain economically viable in the long-term. Alexander emphasized how the region relies heavily on second-home buyers, and claimed the rate increases would pay off in ensuring reliable service to those and similar consumers.

“They’re the one’s who support the building trade, supply store employees, and others,” said Alexander. “Our request for cost recovery reflects the fact that we already spent billions of dollars to build a cleaner and reliable electric system,” he said. Alexander concluded by pointing out that despite the proposed rate increases, Duke Energy’s rates will still fall below the national average.

Lucy Evanson, a representative of Public Staff at the N.C. Utilities Commission, was present on behalf of Duke Power customers. “Public Staff has a team of experienced accountants, financial analysts, engineers, and rate specialists,” stated Evanson. “We are currently auditing Duke Energy’s Carolina operations. Duke has requested a substantial increase in rates and we will contest the overall increase. We are still investigating and auditing, so we have not finalized our recommendations yet,” she said. Evanson said her organization’s written testimony will be filed on October 31 and will be posted on the N.C. Utilities Commission’s website.

After Evanson introduced herself to those in attendance, she called out the names of the citizens who signed up to testify against the rate increases.

Lucy Evanson, a representative of Public Staff at the N.C. Utilities Commission, was present on behalf of Duke Power customers. “We are currently auditing Duke Energy’s Carolina operations. Duke has requested a substantial increase in rates and we will contest the overall increase,” said Evanson. Photo by Chad SimonsScott Burns, a Franklin resident, was the first witness to swear an oath to testify against the Duke Energy proposal. “I feel that the monopoly of Duke having the power here gives me no other choices in the decisions that are made,” said Burns. “A 17 percent rate increase is in my view, and the view of many people I work with, outrageous and untenable. It will create a lot of hardships. Families will not be able to make ends meet,” he said.

Cecil Bothwell, an Asheville City Councilman, testified against the rate increase as well, strongly questioning the timing of the Duke request. “We are in the midst of a serious recession and this is going to affect not only individuals, families, and single mothers, but also the businesses that employ people in these mountains,” Bothwell said.

Bob Harold, Manager of Stanley Furniture in Robbinsville, provided Duke representatives with some insights on what the rate increases would do to manufacturers in the region, an industry that is already struggling to compete in the 21st century economy. Harold’s perspective on the issue was appropriate following the testimony of Councilman Bothwell. “We spend $1.2 million a year on electricity from Duke Power,” said Harold about Stanley Furniture. “This will put us in a very noncompetitive situation and will increase our electricity bill per year by $180,000. We are competing against the Chinese, the Indonesians, the Vietnamese for a product. The only advantage we have is to be able to say Made in the U.S.A.,” Harold said.

Harold followed up those remarks by pointing out that the rate increase could seriously threaten Stanley Furniture, a company that employs 420 full-time residents in Robbinsville. “There is not any other industry in Robbinsville. It would be very devastating to that area if this facility closed,” he concluded.

Commissioner Ronnie Beale testified against the Duke Energy rate increases Wednesday night, expressing his concerns about how the proposals will further exacerbate an already depressed local economy. Photo by Chad SimonsCounty Commissioner Ronnie Beale attended the judicial hearing, representing the entire board in opposing the company’s rate proposal. Beale presented Duke Board representatives with some dismal statistics, saying Macon County received $487,000 in 2010 from the low-income assistance fund to uplift citizens in dire financial straits. The funds assisted 1,700 families in Macon County. According to Beale, the county hopes to receive $46,000 in aid for needy citizens in this fiscal year, which should help 200 people. Obviously, assistance for needy families is drying up, he explained.

Beale discussed the statistics to accurately express how tough the economy has been on many Maconians, and how a higher energy bill will do nothing to improve the situation.

“We have a very large, low-income elderly population,” said Beale. “You hear the unemployment rate is ten percent. Those of us in the construction business can tell you the actual rate is much higher. So I ask the Commission to look seriously at this before you raise the rates in all of the rural counties in this district. I speak for Macon County, but I can attest that all of the rural counties are under the same burden,” he said.

Franklin resident Joan Mackey testified at the hearing as well, criticizing Duke Power for raising energy rates on consumers while giving their CEO a two million dollar salary increase in 2010. “We have to have power, we know that. We think that other things should be looked at before a rate increase is passed,” said Mackey.

Duke Energy’s public hearings on the rate increases will continue in High Point tomorrow night and end in Raleigh on November 28.


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