From the Editor

Drescher: Part of utility merger story goes untold

jdrescher@newsobserver.comJune 30, 2012 

We have covered the twists and turns of the proposed merger of Progress Energy and Duke Energy for 18 months. But there’s an important part of the story we’ve been unable to tell you.

The utilities signed about 15 confidential agreements last year promising financial benefits to large customer groups: rural electric cooperatives, municipal power agencies and industrial power users. In exchange, the co-ops, municipal and industrial users agreed not to oppose the merger.

The utilities are regulated by the N.C. Utilities Commission, the state agency that approved the $26 billion merger Friday. The six commission members were appointed by Gov. Bev Perdue or former Gov. Mike Easley.

The commission has seen the secret deals. But it has not released them.

The N.C. Waste Awareness and Reduction Network, a nonprofit based in Durham, asked the commission on June 18 to release copies of the agreements.

Shortly after, The News & Observer asked the Utilities Commission to release the agreements. We made a more formal request last week. The commission still has not decided. We will continue to seek release of the documents.

What state law says

Under state law, once a document is received by a public agency, in general it becomes a public record. Anyone can request and receive the document. The agency is required to produce it promptly.

The issue of whether the documents are public shouldn’t have been delayed by the decision on the merger.

There’s nothing in the law that allows an agency to delay releasing public information until after a difficult or complex decision has been made. The law encourages robust public debate, not a stifling of it.

The commission was charged with reviewing the benefits and costs of a merger and determining whether it would be best for North Carolina. Full disclosure is vital to making sound decisions that can be supported by taxpayers.

The utilities contend that NC WARN’s request should be rejected. They said the confidential agreements are trade secrets under state law and therefore not public.

They also said NC WARN’s request should have been made months ago and that NC WARN lacks legal standing to make such a request on the public’s behalf.

Whether the deals are trade secrets is a matter of debate. The utilities’ arguments about timing and standing are irrelevant; under state law, any citizen can request any public record at any time for any reason.

Protecting interests

What’s in the agreements? We wish we could tell you. N&O reporter John Murawski has done a fine job in covering this story, but he has not seen the agreements.

The deals were reviewed by utilities commissioners and parties to the merger if they signed nondisclosure agreements. The commission never should have agreed not to disclose information about the deals. If the agreements are relevant to the merger, they should have been disclosed.

When it comes to sharing information, the terms should have been dictated by the commission, not Duke and Progress.

In the hearing this week, James Hoard, a member of the Utilities Commission Public Staff, said, “These agreements are basically each of the parties trying to protect their own interests.”

Consumers have interests, too. The secretiveness undermines public confidence. The private deals could hurt some customers. Now those customers won’t learn about the effects of the deals until it’s too late to do anything about it.

Drescher: 919-829-4515 or jdrescher@newsobserver.com. On Twitter @john_drescher

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