Duke Energy CEO Faces Questions About North Carolina's Renewable Energy Portfolio Standard
Company that Pushed for "Green" Standards in 2007 Declines Opportunity to Oppose or Endorse Continuation of Standards as N.C. Legislature Considers Repeal
Duke Energy Says "No" to Wind Energy in N.C.
Shareholder Also Thanks Duke for Standing Up Against Liberal Race-Baiters in Attempts to Have Company Sever Ties With Free-Market Group
Charlotte, NC / Washington, D.C. - Today, at Duke Energy's annual meeting of shareholders, Justin Danhof, Esq., director of the National Center for Public Policy Research's Free Enterprise Project, asked Duke Energy's CEO Jim Rogers if his company would support repealing North Carolina's renewable portfolio standard.
A North Carolina Senate committee voted to repeal those standards yesterday. Duke supported enactment of the standards in 2007.
"In his response, Rogers downplayed the cost to North Carolina's consumers of the renewable energy standard," said Danhof. "This implication is not in line with reality for many North Carolinians who are watching their electric rates soar while Duke and its subsidiary, Progress Energy, are seeking new double-digit rate hikes."
"Furthermore," said Danhof, "A study by the John Locke Foundation and Beacon Hill Institute found that North Carolina consumers will pay an extra $2 billion between 2008 and 2021 because of this law. That's a lot of money, and because mandated energy cost increases are regressive, this is the equivalent of a tax focused on the poor."
An audio recording of the exchange can be found here.
In 2007, North Carolina passed a law, the Renewable Energy and Energy Efficiency Portfolio Standard (REPS), which set in motion a sliding scale mandating that public utilities use minimum percentages of renewable energy for retail sales. In 2012, the minimum renewable requirement was three percent and that amount rises to 12.5 percent in 2020 and thereafter.
However, as the mandates take effect, they are becoming increasingly controversial and harming the state's economy. A new paper, "It's Time for North Carolina to Scuttle Its Renewable-Energy Mandate," written by National Center senior fellow Bonner R. Cohen, Ph.D., says, "Duke Energy and its subsidiary, Progress Energy, the state's two largest utilities, recently sought rate increases for residential customers from the NC Utility Commission of 14.2 and 11.7 percent, respectively. As North Carolina's RPS requirement is ratcheted up in the years to come, ratepayers can expect more of the same as utilities are forced to buy more expensive renewable power."
In his paper, Dr. Cohen goes onto note that the REPS is damaging to the Tar Heel state's overall economy. He explains that, "[w]ith an unemployment rate of 9.2 percent, well above the nationwide figure of 7.6 percent, North Carolina can ill-afford a regulatory structure that discourages businesses from relocating to the state. But that's exactly what North Carolina's renewable-energy mandate does."
"High electric rates work as a sort of regressive tax - they disproportionately harm the most vulnerable among us," said Danhof. "Low and middle-income residents pay a higher percentage of their after-tax income towards energy costs than do the wealthy, and are therefore most sensitive to these artificial rate increases."
Another shareholder asked why, if the company was increasing efficiency, as Rogers claimed, would electric rates increase and not decrease? Rogers replied that the rate increases were to cover the company's $9 billion investment in new buildings and a new fleet - i.e., the increased costs of going green.
"While Rogers talked a lot about the company's green energy investments he was adamant that Duke would not put money into wind energy for North Carolina. According to Rogers, wind energy is not viable in any economic sense, and would only remotely work on the ridgeline - an area where he has a home. Rogers said that wind turbines on the ridgeline 'wasn't going to happen.'"
During his question, Danhof cited work by free-market allies at the John Locke Foundation, the Beacon Hill Institute and the Heartland Institute to show the broad-based concern for the damage the REPS are causing to the people and economy of North Carolina.
Despite concerns about Duke's activities surrounding the renewable portfolio standard, Danhof also lauded the company for standing up to radical leftists who have attempted to coerce Duke into severing ties with the America Legislative Exchange Council (ALEC). Using race-baiting tactics and misinformation, a determined left-wing coalition has gotten more than 40 corporations to end their ALEC corporate memberships.
In August of last year, a coalition of these radical organizations including Greenpeace, Common Cause and the Center for Media & Democracy, sent a letter asking Duke Energy to leave ALEC, falsely complaining that ALEC was "intentionally crafting and supporting Voter ID bills and other legislation designed to suppress people from voting and participating in our democracy."
"The coalition's statement is untrue," said Danhof. "ALEC disbanded its task force that worked on voter ID legislation in April 2012, five months before this letter was sent, and voter ID is designed to protect legal voters and deter only illegal voters. Voter ID laws are a constitutional, commonsense way for a state to protect its citizens from voter fraud - a point decisively settled by the United States Supreme Court in 2008."
A copy of Danhof's question at the meeting, as prepared for delivery, can be read here.
The National Center for Public Policy Research is a Duke Energy shareholder.
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