Duke Energy suspends rebate program after contractor’s bankruptcy

A Seattle company that’s been processing rebates to Duke Energy customers who donate old appliances has gone out of business, leaving thousands of Duke customers in North Carolina and elsewhere with bounced rebate checks and defunct refrigerators.

Charlotte-based Duke has vowed to reimburse all affected customers – estimated to exceed 4,000 people in six states – with their $50 rebates and to make up any bank charges for bounced checks.

In a letter filed Wednesday with the N.C. Utilities Commission, Duke said the unexpected insolvency of Jaco Environmental has stranded customers of multiple utilities in 35 states. Duke said Jaco ceased daily operations on Nov. 23 after a Washington state court judge placed it in receivership.

“This unexpected turn of events has presented challenges to the Companies in serving their customers that participate in the Appliance Recycling Programs,” Duke’s associate general counsel Brian Franklin wrote.

Duke has temporarily suspended its appliance recycling program until it can find another contractor to administer the service. The company is advising customers not to try to cash their rebate checks because the checks are likely to bounce and incur additional bank charges that Duke will be obligated to pay.

Duke’s appliance rebate program is designed to encourage customers to replace older, inefficient appliances with newer, high-efficiency models. The company pays customers in North Carolina $50 to donate their appliances for recycling; Jaco was the company hired to handle the removal, recycling and rebate processing for customers.

This year so far, Duke has processed 23,000 appliances in the program in six states, including North Carolina. Duke Energy Progress recycled 9,019 refrigerators and freezers in 2013, according to an annual report filed with the Utilities Commission. But the 2013 customers received their rebate checks many months ago and won’t be affected by Jaco’s ceasing operations.

Those who participated in recent months are likely to get entangled in the Jaco insolvency. One such customer is Mary Ann Booth, a retiree in Johnston County who donated her Gibson chest freezer, which she estimates was about 40 years old. The old Gibson was hauled away Sept. 11 and the rebate check arrived about two weeks ago, Booth said.

Booth cashed her check and that evening received an electronic notice from Wells Fargo bank that the check bounced for insufficient funds, resulting in a $50 transfer and $12 charge to her account.

“I’m out $62,” Booth said. “I’m just waiting to see what happens next. I’m not going to be very happy if they don’t honor their obligation,” she said of Duke.

Duke’s Appliance Recycling Program Team assured Booth by email that she will be compensated.

“As you may have already heard, on November 23, Jaco Environmental, the company Duke Energy used to operate the program, unexpectedly discontinued all operations and closed the bank account used to fund incentive checks,” Duke wrote. “Please know, we are standing behind this program and are committed to honoring the incentive due to you and the banks fee associated with your returned check.

John Murawski: 919-829-8932, @johnmurawski