Waiting to decide who should pay for ash pond cleanups

March 10, 2014 

At first mention of Duke Energy’s intention to recoup the money it spends on coal ash cleanup from customers, the knee wants to jerk right up to the ears. The customers are going to pay for the company’s mistake? You’ve got to be kidding.

After all, Duke is the world’s largest electric utility and made a profit of $2.7 billion last year.

But for customers, the consequences of the now-infamous Dan River coal ash spill last month really are unknown.

What is known is that if the company seeks to add 75 cents or so to customers’ monthly bills to pay for the spill’s cleanup and for more secure storage of coal ash at other sites, Attorney General Roy Cooper says he will fight it in court.

And the state Utilities Commission, which would have to approve any settlement with Duke, is a politically sensitive organization that isn’t going to want to look anti-consumer should it approve a rate hike.

In addition, the state Department of Environment and Natural Resources is under the public microscope with people wondering whether DENR was a little too easy-going and “customer friendly” with Duke when it came to the coal ash situation. Add another complication to that one: Gov. Pat McCrory is a former Duke employee, and among his promises in campaigns and on taking office was to reduce regulations that in his view hampered business.

Then there’s this wild card: A federal grand jury is going to convene this month, likely to investigate whether anyone was aware of rules being violated. If it emerges that Duke improperly sought to ease coal ash rules, then clearly the utility should pay to eliminate the hazards that resulted.

It’s hard to know whether Duke’s floating the idea of customers footing the bill is just a preliminary to a proposal that the company pay part of the expense and that customers pay a smaller share. The company position is not without reason: The way the coal ash has been stored, in waste lagoons, is legal. Regulators knew about it.

That said, groundwater contamination has been found. The extent of the pollution isn’t fully known, but at two locations Duke has agreed to provide alternate drinking water sources. State officials say that they’ve tested groundwater samples in the course of a lawsuit DENR has filed against Duke and that the levels of trace elements such as iron and manganese aren’t toxic to most people.

But there still is more testing to be done, and the state must determine the urgency and timetable of the cleanup.

As for who should pay the cleanup costs, it’s in the public’s interest for Duke Energy to remain a healthy company. It has much territory to cover and must maintain resources to deal with emergencies such as weather problems that disrupt power. Customers do not want a weak or unstable power company.

But they do want, and expect, a company that does business in a way that protects the environment and follows the rules. Duke is getting ready to undergo what’s likely unprecedented scrutiny of its operations. What comes out of the scrutiny may well clarify who should pay for the coal ash mess.

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