Lawmakers hit the brakes Tuesday on legislation to change the way North Carolina regulators approve utility rate increases, dealing a blow to Duke Energy, which pushed hard for the change.
The soon-to-emerge new version of Senate Bill 559 will still change the way Duke and other utility companies finance storm repairs, a move said to save ratepayers money that always had broad support at the statehouse. But the bill's second section, which supporters had previously declined to separate from less controversial parts of the bill, is coming out.
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Update: Both the House and Senate passed this bill unanimously in votes Tuesday and Wednesday, and it's headed to the governor's desk.
The state Senate was on board with this second part of the bill, but supporters couldn't get over the hump in the House. Support, and opposition, was bipartisan in both chambers.
Supporters said the measure represented a much-needed modernization of North Carolina's outdated method for reviewing utility rates. Critics agreed changes are needed but complained that the bill was a giveaway for the state's largest utility.
This second section of the bill would have allowed the North Carolina Utilities Commission to approve rate increases up to three years in advance, a change supporters said would bring stability because large electricity users would know what to expect. It also included "banding" for Duke's return on equity and would have allowed the company to earn a little more or a little less than a middle point approved by regulators before having to return money to customers.
Hundreds of millions of dollars were at stake, and industry analysts followed the bill, dinging Duke's stock in written reports as the legislation faltered earlier this year.
A Duke spokeswoman said via email Tuesday that company leaders hadn't seen a final bill yet but that they support moving forward solely with the bill's storm repair portion "because it will allow our customers to save money now on storm repair and recovery costs."
The House had pushed to tack a study into the bill to look at rate-making reform ideas like the ones Duke proposed. The new bill won't include that. State Sen. Ralph Hise, R-Mitchell, an original bill sponsor, said there's "no value" in a study.
Hise and others argued for months that the issue was fleshed out, and it was time to proceed.
Gov. Roy Cooper expressed concerns with the bill but never publicly threatened a veto. The solar industry also pushed back against the measure, making for tougher sledding in the House. A solar group sent out a fundraising ask for Rep. John Szoka, R-Cumberland, earlier this year, calling him a champion for opposing the bill.
Hise said the loss of the bill's second section is a significant one for ratepayers and industries needing more predictable costs. Some industry groups, though, opposed the bill over concerns it would increase costs.
Hise and other supporters said Tuesday that they may try later to pass the legislation's discarded section.
"I think we can control a lot with banding," he said. "We'll see what the temperature (for that) is in other times this session and maybe in other sessions."
"You will see it come back," state Rep. Julia Howard said from the House floor. "Because it is the right thing to do to plan for the future."