Thursday, January 15, 2015

Duke Energy could recover ash disposal costs -- or not

Duke Energy's costs of closing its North Carolina ash ponds could be passed to customers if it's a statutory requirement, the state Utilities Commission chairman says.

Chairman Edward Finley appeared Wednesday before the Coal Ash Management Commission to lay out how utility rates are set, a task that he noted has taken him a 40-year career to fully grasp.

Finley said other factors could weigh against Duke recovering disposal costs the company has estimated at up to $10 billion, such as whether Duke violated environmental standards. But he's making no predictions on what will happen.

"I'm going to give you no promises or no indications of what the Utilities Commission might do," he said. "That will all depend on the facts of the case that is presented and the law that is argued to us."

State law allows utilities to recover through rates their "reasonable and prudent" costs, such as expenses for building power plants, from an earlier 12-month period. The utilities panel is charged with seeing that those costs are kept as low as possible.

There are other ways utilities can recoup their costs. They're usually created by the legislature, such as riders that charge customers for expenses of the state's renewable-energy mandate. Duke was also allowed to recover the costs of installing air pollution controls under the 2002 Clean Smokestacks Act.

Ash pond closures under state orders "pretty well would insulate (utilities) in my opinion" in seeking recovery, Finley told the ash commission. The General Assembly last summer gave Duke a 15-year deadline to close its 33 ash ponds.

Duke hasn't decided when or how it will go to the Utilities Commission for recovery, said spokesman Jeff Brooks. Duke has said customers won't pay the costs of cleaning up its spill into the Dan River last February. 

"Closure of basins is part of the normal life cycle of the plant, and the costs for operation and decommissioning and closure of our sites typically has been recovered through customer rates," Brooks said.


Frank Burns said...

If they want to pass the ash removal costs to the consumers, then the decision should be to leave the ash in the basins.

Anonymous said...

How about passing those costs on to the Democrats in the General Assembly who approved of coal ash dumping for 70 years?

Reese from Ranlo said...

Why wouldn't customers pay for ash disposal? They benefited from the legal, low-cost method of ash basins in the form of lower rates for decades. If lined landfills are now the answer, then customers should pay for that. Just like the billions paid for other pollution controls that didn't add a single megawatt of capacity to the system.

Anonymous said...

Frank: It seems you're concerned that costs for customers such as yourself will be negatively impacted by removing ash from unlined basins. Yet consider- leaving the ash in unlined basins allows it to continue contaminating drinking water across the state. So if you end up with cancer, who pays for that?

Of course, that's based on your scenario of the customer paying for the cleanup. I would favor Duke paying.

Anonymous: I'm not sure where you picked up the impression that Democrats supported dangerous disposal methods for coal ash over the last 70 years... A quick search can easily reveal dozens of credible news sources indicating that the current Republican state party has been working incredibly hard to obstruct environmental protections. But besides that, the issue is more about money than politics. Both parties have been outrageously corrupt on issues such as this one, because time and time again, corruption pays.

Reese: There are a few reasons customers shouldn't pay... 1) Duke has worked very hard to hide evidence of how much damage they've done to water quality in N.C., so it's clear that their culpability goes far beyond ignorance 2) I could find sources to back this up, but I'm sure you agree.. beyond whether or not we'll buy their product, large corporations do not care about you or me. So if Duke was saving money by leaving coal ash ponds unlined, do you really think they were passing those savings off to customers all this time? Earth to Reese! Let's be real here.

Anonymous said...

Here's a novel approach. How about using some of your massive PROFITS to pay for it instead of putting it on the backs of your customers.
Profits are not only for paying your shareholders and executive officers, they are for putting back into the business to improve that business.

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