Gov. Pat McCrory said Tuesday he's going to stay out of the debate whether his former employer Duke Energy should be allowed to pass to consumers the costs of closing North Carolina's coal ash ponds.
Duke Energy is expected to give McCrory's administration more information this week about plans to ultimately dispose of the coal ash at more than 30 ponds statewide, as well as the costs associated with any environmental cleanup. The request from McCrory and state environmental Secretary John Skvarla came in response to last month's massive coal ash spill into the Dan River.
Last week, Company CEO Lynn Good said Duke Energy will pay for the spill cleanup but suggested customers shoulder the cost of disposing what's in other ponds at 14 of the plants. Such a plan, which could include hauling the ash away for recycling or transferring the ash into lined landfills away from water sources, could easily cost several hundred million dollars.
McCrory, who worked at Duke for nearly 30 years until 2008, said financial decisions on the cleanup are best left to the state Utilities Commission, which sets electric rates and can agree to let Duke pass along one-time costs to customers.
“I think it's inappropriate to have politics involved in this process,” McCrory said after a Council of State meeting. “You've got to have this process work out free of politics, especially … as we try to get the facts exactly about what has happened and what the potential solutions are to this very serious issue.”
Still, environmental regulators within McCrory's Cabinet-level agency or the General Assembly may demand the cleanup and use of a certain method.
Rep. Ruth Samuelson, R-Mecklenburg and co-chairwoman of the legislature's Environmental Review Commission said it made sense to her for both shareholders and ratepayers to pay for any pond closings, although she didn't know how the burden should be distributed.
“All of those years both sides were benefiting from the way coal ash was being handled” in the form of ready energy for customers and less expensive operating expenses, Samuelson said. Today, she added, “both sides should have something to pay” for the extra cost of cleaning up the ash.
The legislature in recent years have allowed utilities to pay for energy-related environmental directives it approved by passing along costs to ratepayers.
A 2002 law demanding sulfur dioxide and nitrogen oxide emission reductions from coal-fired plants was financed by postponing rate cuts for consumers. Five years later, the legislature agreed utilities could assess a rider upon customers to pay for a requirement that a set power of their power come through efficiencies and alternative sources.
Attorney General Roy Cooper, a Democrat, has said he will oppose any effort to pass coal ash pond clean up to consumers. His office has previously challenged rate increases by the Utilities Commission he's labeled as too high.
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