North Carolina families are hoping to save money wherever they can these days. Somehow, Duke Energy thinks it should be allowed to make a larger than normal profit when its customers save on electricity than when they use it.
Attorney General Roy Cooper's office has told the N.C. Utilities Commission that Duke's "Save-A-Watt" program is illegal. It would allow the company to make excessive profits from the energy conservation plan that results from legislative efforts to reduce electricity use in the state.
In the effort to reduce North Carolina's emissions of climate-changing gases and promote alternative-energy production, the legislature last year set modest goals for the utilities. They are to meet some of the expected growth in electrical demand through a combination of conservation and alternative-electricity production.
So, in part, the utilities are being told to dissuade their customers from buying some of their product -- an unusual order to give to a for-profit company.
To make that unusual order more reasonable, the legislature said that the utilities could make a profit from this effort. And that would only be fair. If the utilities spend money and effort devising energy conservation programs, they should receive remuneration. There's nothing wrong with that.
What has been wrong with the Duke program since the day the company announced it is the amount of profit sought. Duke wants to make a lot more money not selling electricity than it makes selling it.
It's so confusing that North Carolinians are certain to wonder whether they'd be better off financially by leaving the lights on rather than turning them off. (Even under the Duke plan, it's more economical to turn them off.)
Cooper's report to the commission says the Duke plan would be illegal because it would lead to rates that are not just and reasonable.
Under North Carolina law, utilities are guaranteed a nice return on their "rate base" expenditures. These are the legitimate costs of running the regulated companies. Costs for the legislatively mandated efficiency and alternative programs would be considered legitimate.
But Duke wants the money it spends on Save-A-Watt to generate profits of 45 percent, a greedy grab that would make some Wall Street bankers blush. To generate those profits, our electricity rates would have to rise to illegal levels, the attorney general's office maintains.
While Duke would like utilities commission approval for Save-A-Watt by the end of the year, we can only hope that the commission will apply the brakes. Duke should be allowed the same kind of profit for its conservation investments as it gets for those made to generate electricity.
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