NC Attorney General signals legal challenge if Aqua rate hike approved

Posted by John Murawski on March 7, 2014 

N.C. Attorney General Roy Cooper signaled this week his office is set to appeal yet another utility rate increase in the state, this time a 5.2 percent proposed rate hike for Aqua North Carolina, if it is approved by the N.C. Utilities Commission.

In a filing with the Utilities Commission, Cooper’s office said that a proposed settlement between Aqua and the N.C. Public Staff suffers from the same legal deficiencies that doomed a 7.2 percent rate increase the Utilities Commission approved for Duke Energy and was overturned by the N.C. Supreme Court.

The Aqua settlement is awaiting a decision from the Utilities Commission. It would grant Aqua a 5.2 percent rate increase and allow the private waterworks to raise rates up to 5 percent without public hearings. The Public Staff is a state agency that represents state residents in utility rate cases.

Aqua is the state’s biggest private water utility, with about 90,000 water and sewer customers, and already charges about twice as much as Raleigh, Cary and other municipal water agencies.

The AG told the Utilities Commission that Aqua’s rate case does not take into account the rate’s economic effect on customers, the same issue on which the N.C. Supreme Court overturned a Duke Energy rate increase and asked the Utilities Commission to recalculate it. The AG also says that allowing the company to raise rates without public hearings is not in the public interest.

And the AG notes that N.C. Treasurer Janet Cowell has urged the Utilities Commission to reject Aqua’s proposal to be able to raise rates in the future without public hearings. Cowell noted in January that Aqua has benefited from low financing rates available through state loans. “It is particularly important in a case such as this where, already, there has been access to inexpensive public financing and much consternation generated by simultaneous rate increases,” Cowell wrote.

The AG has appealed rate increases for Duke, Progress Energy and Dominion, all on the same grounds: that the Utilities Commission did not weight the economic harm to customers.

After the Supreme Court overturned Duke’s rate increase, the Utilities Commission upheld its own ruling and the AG has appealed again.

The Dominion case is awaiting a Supreme Court ruling and the Progress case is awaiting a Supreme Court hearing.

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