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Utility accused of running ‘dog and pony show’
Friday, 02 June 2017 11:19
By JOHN NORTH
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Duke Energy was accused of launching a local joint energy task force that amounts to little more than “a dog and pony show” during a May 5 meeting of the Council of Independent Business Owners at UNC Asheville’s Sherrill Center.

CIBO member Mac Swicegood voiced the criticism during a question-and-answer period that followed a presentation by Duke Energy’s Jason Walls.

“Now you’ve got a task force comprised of Brownie (Newman), who’s in the solar panel business; and Julie (Mayfield), who’s trying to stop everything, and you’re stuck in the middle,” Swicegood told Walls, who is also a member of the three-person unit. “It’s like a dog and pony show.”

Newman, who lives in the Montford community, founded — in 2015 — a new solar energy company, Headwaters Solar. He is chairman of the Buncombe County Board of Commissioners.

Mayfield, who lives in West Asheville, is co-director of MountainTrue and a member of Asheville City Council. MountainTrue battles for area environmental and conservation causes.

In a state hearing, MountainTrue was a key opponent to Duke Energy’s plan to replace its coal-fired generator in South Asheville with two new 280-megawatt combined cycle natural gas-fired electric generating units with fuel oil backup. At the same hearing, Swicegood spoke strongly in favor of Duke’s proposal. Duke eventually received approval to proceed with the two natural gas generators.

In responding to Swicegood’s verbal joust, Walls said, “Personalities aside, I think we have a lot of the right people around the table... Brownie and Julie, each, were appointed by their respective political bodies, and I was appointed by Duke.”

He added, “I’m going to resist you’re saying ‘dog and pony show’ because I don’t think that’s a very nice phrase… So I think we have a real opportunity to make real progress....”

In response to Walls, Swicegood said flatly, “But I want to be assured that I’ll have electricity when I switch on something in the morning….”

To that, Walls asserted, “We (Duke Energy) wouldn’t be involved in anything without that. We have a state mandate to provide reliable electricity at a reasonable price.”

CIBO had invited Walls, who has been Asheville district manager for Duke Energy for four years, to provide an update on the utility’s local Energy Innovation Task Force.

On a personal note, Walls began by saying, “Asheville has become home for us (his family) — and we don’t want to go anywhere soon.”

He added, “There’s never been a more exciting time to be at Duke Energy than right now.”

In his talk, he would “set the stage — and then overview EITS,” Walls told CIBO.

“In 2015, we were able to leverage a large natural gas expansion project,” Walls said. “That made it possible for us to retire the Asheville coal plant. 

“When we learned about PSNC’s plans to expand the (natural gas) pipeline, we made the economic decision to retire the coal plant early and build the (two) natural-gas plants” to replace it.

“A big part of that is that Asheville and Buncombe County are growing at a rate — really — much faster than anywhere else in North Carolina. We are punching in as fast as Charlotte and other places… insofar as our growth rate on electricity.

“We knew our new plant would be needed … a combustion turbine peaker plant. The commission did not approve that. At the same time, we heard from the community that we can curb our demand for electricity, through solar” and other alternatives, “so we listened.”

He said one of Duke Energy’s primary objectives is to invest in a smarter energy future. For instance, he said that “battery storage is a technology that is evolving….

“So we started the Energy Innovation Task Force — building the airplane we were flying on. It was three members – me, Brownie Newman and Julie Mayfield. We realized about five months in, that we needed help. So we enlisted the help of the Rocky Mountain Institute.

“What we found is they brought with them a lot of credibility in the power conservation and community organizing space. So they will help us decide what’s cost-effective” and help address “what will give us the best bang for the buck,” Walls said.

He added that a question Duke Energy was addressing with the task force was “how do we leverage the spirit of the community to conserve?”

What’s more, Walls said, “The Shelton Group was hired to do community engagement plan to help drive more conservation behavior.”

He concluded by noting that the task force “was born out of the community.”

Besides Swicegood’s aforementioned comments during the question-and-answer session that followed, an unidentified man said, “Some of the numbers I’ve seen have been pretty attractive about battery technology. Tell us more.”

“We have an early-morning peak in WNC,” Walls replied. “Solar doesn’t help us. But when you add battery storage, then it can help. Batteries also have other stacked benefits. You can use it (battery power) during peak times. The thing about storage, as technology becomes more efficient and prices come down,” it becomes a more viable option.

Another unidentified man asked Walls to comment on delays in Duke Energy’s response to service requests “because of the economic spurt.”

“We’re adding meters” and other improvements “more than we were prior to the Great Recession,” Walls answered. “We’re rebuilding our staff. Over the last two years, we’ve got some orders that are getting pushed back two weeks to several months. We’re in a really high-growth community, so we really have to staff up.”

Yet another unidentified man asked “if there are other possibilities besides solar? Seems like lots of other technologies emerging even faster than solar.”

“Before we create new programs, we have to figure out why customers aren’t leveraging the programs we have today,” Walls replied. “I’d say there is no technology on the table” — beside solar and battery storage. “There is opportunity and room for a lot of discussion.”

On an unrelated matter at the CIBO meeting, Buncombe County Manager Wanda Greene presented the county’s budget proposal for fiscal 2017-18.

The budget would increase by 2.3 percent increase — or $7 million, Greene said.

She noted that “we’re ‘creatures of the state,’ so we can only have” limited leeway in making decisions on spending and ways to generate revenue

“The property tax is all we can use — it’s 62.7 percent of our revenue stream.

Greene added, “Counties exist primarily to administer state-level programs” in North Carolina. “In our budget, that (state mandates) reflects 92 percent of our expenditures. The other 8 percent” is for facilities and services, such as libraries. “So it’s a really tightly controlled budget by the state.”

In the county’s budget proposal, 41 percent of our expenditures are salaries and benefits,” she said.

“This year we looked at education because we had so many questions on how the funds are spent... For us, home-schooled (children) have a big impact on our libraries... So it’s a fairly complex revenue stream. We do have some new costs in our budget this year. Primarily, from opening the Coxe Avenue (county health and human services) facility.”

Greene noted that $2.8 million of the budget is “primarily to restore the exterior of our old courthouse” and “we do carry about $4.7 million in debt — 62 percent of that debt is paid with restricted funds... We also have some economic development debt, and that’s paid with lease payments.

“We’re timing out debt a lot better than we used to,” she said.

Following a May 16 retreat, where she and the county Board of Commissioners reviewed the financial state of the county, Greene said a public hearing on the budget plan would be held June 6. A final vote on the budget is scheduled June 20.

“That’s the turbo-verson of our budget,” Greene concluded with a smile.

During the Q&A session that followed, Swicegood said, approvingly, “You (Greene) speak about a million dollars like they are dollars…. The numbers are phenomenal. Each year, you get stuck with some fee from the state.

In 2017, we lost $600,000 in sales tax” due to changes by the state, Greene replied. “We will lose $1.4 million in sales tax” unless the state is able to get things changed for this year. “Right now, what we’re especially dealing with is sales tax.”

An unidentified man asked, “$1.3 billion in assets? Are you depreciating those assets?”

“These are all brick-and-mortar assets,” Greene answered. “In government, you don’t depreciate it. So it’s the price we paid when we acquired it, based on the debt against it.”

A woman asked for clarification on revenue-neutral numbers that Greene had revealed during her talk.

“You get to keep the growth on a year that you didn’t have a rebound,” the county manager replied. “It would have been 53.4 cents. But with spending, it’s 55.9 cents in the budget....”

A man asked for Greene to specify what the $7 million expenditure covered.

“To open the Coxe Avenue facility and utilities, which she said totaled $4.9 million) … and NC FAST and some retirement issues... The retirement system is entirely driven by the state.”

A man quipped, “What’s fair is not always equal!” Greene and many in the CIBO crowd laughed at the witticism.

A man then asked, “How much extra money might be gained from growth?”

“Growth was worth about 1.7 percent in our property tax,” Greene said. “It was a big increase in the revaluation.” She added that in Asheville, the Central Business District, North Asheville and West Asheville, “had huge increases.”

 

 



 


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