Duke subsidiaries want to defer $725M in coal ash cleanup costs until future rate case

Dive Brief:

  • In a filing to North Carolina regulators last week, Duke Energy's two utility subsidiaries revealed they have spent a combined $725 million since 2015 to clean up coal ash ponds in the state, and warned it could request ratepayers pick up some of the costs.
  • The Charlotte Business Journal reports Duke Carolinas spent $434 million from 2015 through November of 2016, while Duke Energy Progress spent about $292 million. 
  • Directed by the state legislature, Duke unveiled a proposal last year to excavate 34 basins and cap another 18 basins in place, part of its efforts to protect drinking water from the waste.

Dive Insight:

The Charlotte Business Journal reports Duke told the North Carolina Utilities Commission that coal ash cleanup is a routine expense and asked to be allowed to defer recovery of those costs until the next rate increase, which is likely to come this year. The alternative would be writing off the costs, which could have significant impacts on the company's finances.

Thus far, Duke Carolinas said it has removed almost 3 million tons of coal ash at three facilities, including the Dan River plant. Duke Progress says it has removed about 2 million tons from its Asheville and Sutton plants.

It was the leak at the Dan River plant that launched Duke's coal ash issues into national headlines. The utility has faced scrutiny surrounding its coal ash ponds since a pipe rupture in 2014 dumped waste into that river. In 2015, the company pled guilty to nine misdemeanor federal violations of the Clean Water Act committed by three subsidiaries in the spill, and paid $102 million in fines and penalties.

Duke and the North Carolina Department of Environmental Quality also reached a settlement last year calling for the utility to pay a $6 million fine related to the spill.

In 2014, Duke told North Carolina regulators it could cost anywhere from $7 billion to $10 billion and take up to 30 years, to clean up all the utility’s coal ash ponds in the state.

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Filed Under: Generation
Top image credit: Waterkeeper Alliance