NC WARN Sues State of North Carolina and Regulators for Blocking Court Access in Long-running Climate Fight

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October 12, 2016                                                                                                           919-416-5077

                                                  

NC WARN Sues State of North Carolina and Regulators for

Blocking Court Access in Long-running Climate Fight

Duke Environmental Law & Policy Clinic attorneys challenge constitutionality of two laws – from 2015 and 1965 – in a case that could derail Duke Energy plans to build $30 billion in fracked-gas power plants and pipelines

Durham, NC – In a case that goes to the heart of Duke Energy’s corporate business plan, climate protection nonprofit NC WARN today filed a lawsuit against the State of North Carolina and its utility regulators over two state laws passed 50 years apart.  The group, represented by attorneys for the Duke Environmental Law & Policy Clinic, say a 2015 law passed specifically to allow Duke Energy to shortcut the approval process for a large, fracked-gas power plant in Asheville violates both the state and federal constitutions.

NC WARN also contends that the NC Utilities Commission shielded itself from an appeals court review of the $1 billion Duke Energy project by invoking a never before used law from 1965 to require a $98 million bond that unconstitutionally locked the courthouse doors.  The lawsuit says no other state allows its regulators to invoke a bond to block a power plant appeal.

The lawsuit seeks to have a NC Superior Court panel deem both laws unconstitutional so that Duke Energy cannot rely on similar shortcut approvals and court-blocking bonds for the 15-20 fracked-gas plants it plans to build in the Carolinas by 2030. 

The suit itself would not stop Duke Energy’s controversial Asheville project, which is just getting underway.  A separate case by NC WARN and The Climate Times contesting both the shortcut approval and a $98 million bond order by the NC Utilities Commission is still being fought at the NC Court of Appeals.  The groups insist that a full hearing must finally be conducted, and that case could well go to the State Supreme Court.  

Jim Warren, executive director of NC WARN said today, “The General Assembly gave special favors to a powerful special interest.  But it is plainly unconstitutional for politicians and regulators to allow the giant Duke Energy monopoly to keep building power plants without careful, open review.”

He said the 2015 law led the Commission to approve Duke Energy’s Asheville plant without adequate scrutiny and information, thus creating a financial burden for customers that is wholly unnecessary due to a regional glut of power supply.  Also, a climate expert for NC WARN – who was not allowed to testify – said the plant would be disastrous for the fight to slow the accelerating climate crisis.

The largest US electricity provider, Duke Energy is greatly expanding its burning of fracked gas despite burgeoning evidence that the natural gas industry has become the leading driver of US greenhouse emissions.  Cornell researchers and others say a large amount of unburned gas – which is mostly methane, a super-potent heat trapper – is spewing into the air throughout the US natural gas system, making gas burned to generate electricity even worse for the climate than coal.  

Critics also say the gas industry and regulators have grossly overstated supplies of shale gas, perpetuating a Ponzi-scheme of drilling even as production quickly declines.  

Among the lawsuit’s key constitutional challenges:

Ø   Violation of the fundamental principles of due process, separation of powers and open access to the courts.  The complaint alleges that the NC Utilities Commission cannot constitutionally prevent the courts from reviewing Commission orders by setting excessive bonds that prevent parties from challenging those orders before the State’s appeals courts.

Ø  By granting Duke Energy a shortcut approval process, the General Assembly violated the State’s requirement that monopolies be strictly regulated and provide an ascertainable public benefit, satisfying an actual public need; the State Constitution otherwise prohibits monopolies, saying they are “contrary to the genius of a free state.”

The lawsuit seeks a declaratory ruling from the Wake County Superior Court that would prevent the State from allowing Duke Energy to use the shortcut approval process for large shale-gas power plants it plans to build.  It also seeks to prevent the Commission from blocking court review of its own decisions by imposing multi-million dollar bond requirements as a condition of a court appeal.

Warren added today: “Duke Energy clearly cannot win an open debate over the need for new fracked gas plants and their disastrous climate impacts.  The regulators have protected Duke from that vitally needed debate – a protection not allowed in any other state – and we’re calling on the courts to correct that massive injustice.”