Dog bites man: Duke Energy prevails in lawsuit, keeping its monopoly in place

At issue was whether an agreement between NC WARN, a member-based nonprofit tackling the climate crisis, was acting as a public utility by providing solar electricity to a church. The public utilities commission – and now a court – has found that it was.

September 19, 2017 Frank Andorka

Creative Commons

In journalism, there’s an old aphorism that goes as follows: If a dog bites a man, it’s not news. But if a man bites a dog, it should run on the front page.

As with all else, there are exceptions that prove the rule, and today’s North Carolina appeals court’s ruling that preserves Duke Energy’s electricity monopoly – particularly with regard to solar contracts – is one such exception.

The lawsuit centered on an agreement between North Carolina Waste Awareness and Reduction Network (NC WARN) and what is identified in court documents only as “a Greensboro church” to sell electricity to the church from solar panels NC WARN built and maintained on the church’s property.

The two questions were these: Did the agreement with the church necessarily convert NC Warn into a “public utility”, which would then subject them to oversight by the North Carolina Utility Commission (NCUC)? And, if so, would such an agreement violate Duke Energy’s monopoly right to provide electricity to customers within a state-designated territory?

NC WARN argued before the NCUC that because it was offering electricity only to the church and not the general public, they should not be considered a public utility. Duke Energy and other North Carolina public utilities argued that NC WARN’s agreement violated their state-mandated monopoly.

The NCUC agreed with the public utilities and ordered NC WARN to cease operations, refund the money the church had already paid them (at a rate of $0.05/kWh for the electricity produced by the array) and pay a $200/day fine for each day it had supplied power to the church.

NC WARN appealed the commission’s decision to the North Carolina Court of Appeals, and today the court found, by a vote of 2-1, that under current North Carolina law, NC WARN must be considered a public utility. As such, any agreement it entered into to provide electricity would violate Duke Energy’s monopoly or cease operations. In its decision, the court wrote:

If the legislature desires to except these types of third-party sales, it is within its province to do so and it is not for this Court to determine the advisability of any change in the law now declared in the Public Utilities Act. Accordingly, we affirm the order of the [NCUC] from which NC WARN appealed.

Duke Energy welcomed the court’s decision.

“We are pleased the Court of Appeals has affirmed the N.C. Utilities Commission’s decision,” said Randy Wheeless, a spokesman for Duke Energy. “In this case, NC WARN was clearly and unlawfully acting as a public utility without following the rules of being a public utility.”

As of press time, NC WARN had not indicated whether it planned to appeal the decision again.

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