Monday, May 13, 2013

AG Cooper, Public Staff disagree over Duke rate hike case

Attorney General Roy Cooper said he was standing up for consumers when he challenged Duke Energy's 2012 rate hike, and won. Last month the state Supreme Court sent the case back to the N.C. Utilities Commission to better assess the 7.2 percent hike's impact on customers during a sour economy.

But Cooper apparently won't get any help from the state's other consumer advocates -- the commission's Public Staff.

Days after the high court ruled, Cooper wrote Robert Gruber, the Public Staff's longtime executive director. The court order, he said, meant Gruber's staff no longer had to defend a settlement agreement with Duke that formed the basis for the rate hike.

"We strongly believe that ... the Utilities Commission cannot simply go back and add a few sentences to its decision to justify the return on equity and the rate increase that the court has just reversed," Cooper wrote. "In fact, we believe the commission must consider new evidence on consumer impact in order to provide the analysis that the Supreme Court now requires."

In a 1998 remand, involving a natural gas utility, the commission allowed parties to the case to offer new evidence and held an additional hearing. Cooper has asked the commission to put Duke's rate increase on hold until the current issue is settled; Duke has argued against that.

But Gruber, who will retire June 30 after 30 years on the job, was having no part of walking away from the settlement agreement.

The agreement cut Duke's increase by more than half, he noted in a response to Cooper, and spread it evenly across all customer classes. It also deferred $51 million in revenue Duke had sought for its Cliffside power plant construction and required Duke to donate $11 million to help low-income customers -- provisions that the commission itself could not have independently ordered.

"If the Public Staff abandoned the settlement in light of the Supreme Court's decision, as you suggest we do, these benefits would be in jeopardy and consumers could face even higher rates as a result," Gruber responded to Cooper. "....Our intention now is to fulfill our statutory obligations by assisting the commission in this process, while striving to preserve the substantial benefits to consumers achieved in the settlement."