Residential, small general-service customers to benefit from rate reductions

Published 6:30 pm Wednesday, July 15, 2015

Effective Aug. 1, some City of Washington power customers will see their rates reduced by 6 percent.

As for reductions in other rate categories, those won’t happen — if they happen — until a cost-of-service study (looking at how much it costs the city to provide power to its various types of customers (residential, commercial and industrial) and a load-management study are completed later this year so city officials have the latest information to consider when deciding what to do with existing rates.

In May, the Washington City Council voted for the ordinance consenting to the agreement between Duke Energy Progress and the North Carolina Eastern Municipal Power Agency that should lower power rates in the 32 NCEMPA cities and towns that sell power. The council also approved other documents related to the agreement.

The $1.2 billion agreement allows Duke Energy Progress to buy stakes in power-generation facilities now owned, in part, by NCEMPA. The Federal Energy Regulatory Commission has approved the agreement. Gov. Pat McCrory signed into law legislation that opened the door for the agreement to move forward.

The new law allows NCEMPA members to sell their physical assets (power plants and the like) and issue bonds to refinance approximately $580 million of debt after this purchase is complete. It also allows NCEMPA power agencies to enter into purchase power agreements to replace the electricity previously provided by the generation assets they are selling.

During its meeting Monday, the City Council learned that the last two regulatory hurdles regarding the deal that should result in lower power rates for many eastern North Carolina residents have been cleared. Councilman Doug Mercer said the Federal Energy Regulatory Commission has approved the transfer of the operating licenses for certain nuclear power plants from the N.C. Eastern Municipal Power Agency to Duke Energy Progress. He also said the N.C. Utilities Commission ruled last week that the rate for Duke Energy Progress to recover its costs associated with deal was acceptable.

“I talked to Graham Edwards, who is the CEO of ElectriCities, on Friday afternoon, and asked Mr. Edwards if he saw any reason the sale wouldn’t be completed by the end of July. And Graham, being his normal, tactful self said, “Mr. Mercer, I won’t guarantee it. I’m 99.99 percent sure that we’ll be through by July,’” Mercer said. “I fully expect the generating assets to be sold.”

Mercer also said it appears the wholesale rate at which the city buys electricity from NCEMPA likely will be reduced by about 15 percent and effective retroactively to July 1.

“I think it is appropriate that we pass portions of that reduction on to our residential customers. … I also forwarded to you last week a rather extensive spread sheet that I had been working on which indicates that is possible for us to pass on to our residential and small general-service customers a rate reduction of 6 percent, and I move that we adopt the rate reductions for those two categories effective Aug. 1,” Mercer said.

Councilman Larry Beeman seconded the motion, which received a unanimous vote.







About Mike Voss

Mike Voss is the contributing editor at the Washington Daily News. He has a daughter and four grandchildren. Except for nearly six years he worked at the Free Lance-Star in Fredericksburg, Va., in the early to mid-1990s, he has been at the Daily News since April 1986.
Journalism awards:
• Pulitzer Prize for Meritorious Public Service, 1990.
• Society of Professional Journalists: Sigma Delta Chi Award, Bronze Medallion.
• Associated Press Managing Editors’ Public Service Award.
• Investigative Reporters & Editors’ Award.
• North Carolina Press Association, First Place, Public Service Award, 1989.
• North Carolina Press Association, Second Place, Investigative Reporting, 1990.
All those were for the articles he and Betty Gray wrote about the city’s contaminated water system in 1989-1990.
• North Carolina Press Association, First Place, Investigative Reporting, 1991.
• North Carolina Press Association, Third Place, General News Reporting, 2005.
• North Carolina Press Association, Second Place, Lighter Columns, 2006.
Recently learned he will receive another award.
• North Carolina Press Association, First Place, Lighter Columns, 2010.
4. Lectured at or served on seminar panels at journalism schools at UNC-Chapel Hill, University of Maryland, Columbia University, Mary Washington University and Francis Marion University.

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