Greensboro Church and Watchdog Group Challenge Duke Energy’s Monopoly Capture of Customers
By Jim Warren, NC WARN
A test case that goes to the heart of Duke Energy’s monopoly control over captive customers will be decided by the NC Supreme Court. On October 18, 2017, climate justice nonprofit NC WARN filed with the high court an appeal of the case (PDF), which began in June 2015 when the group began selling solar power to the Faith Community Church in Greensboro, North Carolina, from a system installed on the church’s roof.
Rev. Nelson Johnson, Pastor of Faith Community Church, said:
“We are eager to take this pivotal case to the NC Supreme Court with our partners at NC WARN. With the ominous recent advances of global heat and destructive weather that are hurting so many people nearby and around the world, there has never been a more important time to challenge Duke Energy’s attempts to control the benefits we are all provided by the sun.”
A Court of Appeals panel ruled 2-1 for Duke last month, but Judge Christopher Dillon’s extensive dissent allows the case to be heard by the high court. He cited the federal constitution and multiple NC Supreme Court decisions regarding private property rights, and explained that the Greensboro test case does not make NC WARN a “public utility” as claimed by Duke Energy and the NC Utilities Commission (NCUC).
The test case is a challenge to Duke Energy’s blockade against competition from companies that install solar systems on rooftops with little or no upfront cost to the customer, and then sell power to the customer. Such financing arrangements have been a key to the growth of rooftop solar in many other states.
Jim Warren, director of NC WARN, said:
“The Koch brothers and utilities including Duke Energy have been fighting for several years against such third-party solar sales as part of a coordinated effort to stifle the surge in solar power on customers’ property. This case strikes at the core of that corporate arrogance.”
A new challenge to utility monopolies is quickly emerging as Tesla and other battery makers are now installing low-cost battery storage which, coupled with solar power, reduces customer reliance on traditional power companies. NC WARN is pressing the NCUC and Duke Energy to debate the merits of a new statewide strategy which it says could quickly replace fossil-fuel electricity with on-site solar and battery storage for far less money than Duke Energy’s continuing, multi-billion dollar expansion of natural gas power from fracking operations.
NC WARN points out that third-party sales are in the public interest and are in accord with the NC General Assembly’s declared policy “to encourage private investment in the development of renewable energy,” as Judge Dillon pointed out in his dissent. The judge also noted that the NCUC, in its order for Duke, reversed its own ruling in a previous, similar case.
The legal status of third-party solar in North Carolina was unclear when NC WARN first asked the NCUC for a declaratory ruling on its contract partnership with Faith Community Church in 2015. When NCUC ruled the arrangement illegal, the case went to the Court of Appeals. While that appeal was pending, this year’s House Bill 589 explicitly outlawed third-party sales, likely in response to this case.
NC WARN says that provision of HB 589 is probably unconstitutional, as suggested in Judge Dillon’s dissent, thus the Supreme Court could overturn it. A win by solar advocates in the case could also create incentive for a legislative revisit of third party sales in the future.
This initial filing will be followed by a comprehensive written argument within 30 days. Duke Energy and the NCUC can then respond, and oral arguments will likely be held in February or March.
The $60,000 penalty that Duke persuaded regulators to levy against NC WARN remains suspended pending outcome of the Solar Freedom case. Meanwhile, Faith Community Church and the Beloved Community Center are enjoying free solar power from the 5.2 kilowatt system because the church and NC WARN agreed to stop the sales transaction while the case is appealed.*
NC WARN attorney John Runkle is being assisted in the appeal by Matt Quinn of the Law Offices of F. Bryan Brice, Jr.
*Note: The monthly payments for electricity under the church-NC WARN contract are strictly for the kilowatts, not as a payback of the solar equipment or installation costs.