Duke CEO to make its case for Save-a-Watt

Hearings today on unpopular proposed conservation plan

Duke Energy's CEO James Rogers is set to defend the company's Save-a-Watt proposal before the N.C. Utilities Commission today as critics stage a protest rally outside the commission building.

Rogers will present the company's vision for leading the nation in a quest to create a "decarbonized" economy that dramatically reduces the greenhouse gases that are believed to cause global warming. The Charlotte utility, which operates in five states, is one of the nation's biggest sources of carbon dioxide.

Rogers' testimony follows a week of contentious hearings last month. About 20 experts and officials debated the technical aspects of the Charlotte utility's proposal to curb electricity use by the company's customers in North Carolina.

Rogers is the star witness in Duke's campaign to convince state regulators that Save-a-Watt is a good deal for North Carolina customers.

The Save-a-Watt proposal, branded by critics as a ripoff to customers, has propelled Rogers to celebrity status as a champion of energy efficiency. Rogers has been featured in Rolling Stone magazine and touted by New York Times columnist Thomas Friedman.

Even as Duke pushes ahead, the utility's lawyers are privately proposing a compromise with opponents, including the state Attorney General's Office, the Southern Environmental Law Center and the Public Staff, this state's consumer protection agency in utility rate cases.

The terms of the settlement proposed last month are confidential. Duke also is negotiating over Save-a-Watt in other states where the efficiency program is facing opposition.

In Ohio, Duke has proposed to cap its profits from Save-a-Watt to as low as 9 percent, and to refund excess profits to its customers.

Critics in this state say Save-a-Watt would cost customers 2 1/2 times as much as typical efficiency programs but deliver less efficiency. The proposal is opposed by church groups, consumer advocates, environmentalists and the Public Staff.

In testimony filed with the utilities commission, Rogers said the current regulatory model financially penalizes utilities for promoting conservation and efficiency. As a result, utilities are financially motivated to build new power plants to meet energy demand. A lucrative program like Save-a-Watt would make conservation the first option, not the last, Rogers says.

"I envision a future where energy efficiency is part of a utility's standard offer," Rogers says in the written testimony filed in April. "Under this new standard offer, customers would have to opt out of energy efficiency programs, not opt in. As a result, customers would have to take action to avoid becoming energy efficient."

As proposed, Save-a-Watt is voluntary, not mandatory. The company would offer financial incentives to customers who want to upgrade their homes and appliances to achieve higher efficiency. But all customers would pay to administer the program and subsidize the customer incentives.