N.C. Attorney General Roy Cooper said Tuesday he'll appeal a ruling from the N.C. Utilities Commission that allows the state's utilities to overcharge customers for corporate income tax.
The October ruling from the utilities commission says that utilities can collect a 6.9 percent rate from customers even though the state legislature lowered the income tax to 6 percent this year and 5 percent next year. Utilities typically charge customers for corporate tax liabilities as part of the cost of generating electricity.
The financial amounts in question are negligible on monthly utility bills but come to $21 million a year for four North Carolina utilities. The utilities commission ruling applies to water and sewer bills for water utilities, like Aqua North Carolina, but not for municipal water systems, like Raleigh's or Durham's.
Aqua, Duke Energy and PSNC Natural Gas have publicly stated they will not overcollect from their customers, even though they could do so under the utilities commission's ruling.
But the AG wants to wipe the ruling off the books and will ask the N.C. Court of Appeals to void the utilities commission's decision. In the AG's notice of appeal, filed to the utilities commission, the AG said the commission made a ruling without providing opportunity for a hearing or briefing.
The ruling is also wrong because it violates the commission's duty to protect the public, the AG said.
"Utility shareholders were allowed to pocket the cost savings associated with the reduced state corporate income taxes while most customers bills increased from the combined effect of the other tax changes," the AG's 9-page notice said.