Duke Energy Rate Increases In NC Supreme Court Again

Sep 9, 2014

The North Carolina Supreme Court is once again pondering how much you pay on your electric bill. The court heard oral arguments Monday about whether state regulators adequately considered customer finances when approving rate increases for Duke Energy in 2011 and 2013.


Customer rates went up a little over 7 percent in 2011, and another 5 percent in 2013. Duke says the average western North Carolina household now pays about $14 more a month.

John Maddrey of the state attorney general’s office argued that the state utilities commission did not take into account how the hikes affect ratepayers, particularly low-income.

“Did you hear any testimony? Are there any findings of fact?” Maddrey asked.

The impact of changing economic conditions on customers is embedded in the analysis,” said Chris Browning, attorney at Williams Mullen, who represents Duke.

The cases have made strange bedfellows. Bill Grantmyre, attorney for the Public Staff—the state body that represents customers in rate cases—argued with Duke.

“Public Staff believes that the 236 customers who testified [during public hearings] provided more than ample evidence,” Grantmyre told the court.

The vast majority testified they would have a hard time making the payments, but Maddrey says the commission did not temper the increase.

“The commission acknowledges that testimony, but largely discounts it, saying it’s not persuasive or it dealt with other matters beyond the rate itself,” said Maddrey.

The Supreme Court has now considered five rate cases in the past two years.

The cases have typically made their way to the court through the following process: The power company and the Public Staff agree to a rate increase, the utilities commission approves it, the attorney general appeals it, and ultimately the Supreme Court hears it.

Decisions have been mixed. In 2012, the court told the utilities commission to go back and do more thorough analysis. It came back with the exact same number. Maddrey brought it back to the Supreme Court. That was the second case yesterday.

Maddrey argued the commission added window-dressing, but did not change its analysis.

But the court has also ruled in favor of rate increases—just three weeks ago it validated another, 2013 rate hike to Duke’s eastern North Carolina customers.

In that case, the court said, while regulators need to consider the impact, they did not have to show how that consideration ultimately affects the final, approved rate. Browning argued the same rationale applies to yesterday’s other case.

“That opinion resolves the vast majority of the Attorney General’s arguments in this case,” said Browning.

That argument seemed to resonate. The justices grilled Maddrey, asking for a process the attorney general would prefer the commission use in its determinations.

“There’s several pages of findings,” said Justice Robin Hudson. “Are you saying those findings are inadequate or are not supported by the evidence? What more are you saying the commission should do?”

“Your Honor, I would characterize them as general, as more overview than specific,” replied Maddrey.

There is no timeline for the Supreme Court to rule on the cases; it typically takes months. Meanwhile, the rate increases are already on your bill.