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.