How Purple Politics Cost North Carolina’s Energy Consumers

Two of North Carolina’s largest utility companies, Duke Energy and Dominion Energy
D
, recently announced that ratepayers will have lower energy bills starting September 1 and February 1 respectively. It’s unclear how companies operating in the Tar Heel State managed to reduce costs for consumers while facing such an uncertain, and, at times, burdensome regulatory environment.

We tend to talk about our politics in terms of “red” or “blue.” But some industries, especially those that are heavily regulated like telecommunications and utilities, have a tougher time navigating the ramifications of “purple” politics—which is another way of saying: Democrats and Republicans working together. That may sound like a positive, but it’s actually proving to be counterproductive. In North Carolina, both parties, working together or separately, have simply failed to create a legislative and regulatory environment conducive to economic growth. 

This is a chronic problem in the Tar Heel State, and as a result, Duke Energy and Dominion Energy’s ratepayer protection efforts are at risk. In a state with such an aggressive regulatory agenda, consumer energy price increases for North Carolina families could eventually be a reality.

The Washington Post recently documented the struggles of many North Carolinians to pay mounting utility bills. With congress gridlocked and the federal safety net provided by previous stimulus bills now having expired, residents can ill-afford the state’s purple politics leading to even unfriendlier “solutions.”

Activist commissioners nominated by Governor Roy Cooper to serve on the North Carolina Utilities Commission are a cause for concern for North Carolina’s ratepayers. They are expected to issue consequential decisions on the state’s energy future next year.  Although current commissioners have worked hard to stabilize and even lower rates during this time of great need for their customers, it’s hard to imagine that the commission will do anything other than force utility rate hikes.

Just a few weeks ago, North Carolina officials and their favored interest groups erected a major roadblock to extending the proposed Mountain Valley Pipeline into North Carolina (the “Southgate extension”), by rejecting a necessary water permit. Some of these same special interest groups caused Duke and Dominion to cancel the Atlantic Coast Pipeline in July because of years of court challenges and continued legal uncertainty, which ballooned the ACP’s projected cost by over $3 billion.

North Carolina’s officials need to rethink and refocus their plans. They should want to avoid a repeat of the state’s 2014 and 2018 energy crises, when ratepayers incurred significant price increases because of insufficient pipeline capacity and gas supply. The state is discouraging statewide energy production, innovation, and investment – seemingly to be in a better position to meet arbitrary greenhouse gas emission goals. It doesn’t make any sense.

Gov. Cooper (D) is up for reelection this cycle in a presidential battleground state where he’s navigating these purple political waters. The Governor has an opportunity to build consensus among leaders and come up with real, affordable solutions not only in the energy space, but also to impact the state’s access to broadband and high-speed internet, which has been a constant problem in the state for years. Similar to the success of the state’s energy companies, small, private broadband companies have been able to provide broadband to rural areas that have long struggled to keep up. In order to capitalize on this progress, North Carolina must make the permitting process easier and remove regulatory hurdles that make it difficult to build wireless infrastructure.

Despite all these new regulatory hurdles, North Carolina’s energy and broadband companies have managed to continue providing reliable service at reasonable and affordable rates.  Gov. Cooper has an opportunity at this pivotal moment to reach across the aisle and push back against the bureaucracy and the lobbyists to help the consumers find access to both affordable, reliable broadband and clean electricity. It’s a real chance for the Governor to seize the opportunity to transcend the red versus blue politics that have done so much to poison America’s politics in the 21^st century.