AGA Survey and Statistics System; AGA-CEE Natural Gas Efficiency Programs Survey: Utility expenditures for gas efficiency programs exclude data that have not been released by participating companies at the state level; U.S. Energy Information Administration; and U.S. Department of Transportation.
Statewide Elected Officials Next Election: 2020
Undecided Lieutenant Governor
Josh Stein (Dem.)Attorney General
Legislature Next Election: 2018Session Dates: 04/25/16-mid July
Term: 2 year
President: Dan Forest
President Pro Tempore: Phil Berger
Senate Majority Leader: Harry Brown
Senate Minority Leader: Daniel Blue, Jr.
Senate Member Breakdown
House of Representatives
Term: 2 year
Speaker of the House: Tim Moore
Speaker Pro Tempore of the House: Paul Stam
Majority Leader: Mike Hager
Minority Leader: Larry Hall
House of Representatives Member Breakdown
North Carolina Utilities Commission Commissioners: Gubernatorial appointment, General Assembly confirmation: 6 year termChairperson: Gubernatorial appointment: 4 year term
Edward S. Finley (D), Chairman Appointed by Governor Mike Easley in January of 2007; current term expires in 2019; Appointed as Chairman by Governor Easley in April of 2007; current term as Chairman expires in 2017
Bryan Beatty (D), Commissioner Appointed by Governor Mike Easley in 2009; current term expires in 2017
ToNola Brown-Bland (D), Commissioner Appointed by Governor Beverly Perdue in 2009; current term expires in 2017
Don M. Bailey (R), Commissioner Appointed by Governor Pat McCrory in 2013; current term expires in 2017
James Patterson (R), Commissioner Appointed by Governor Pat McCrory in 2013; current term expires in 2019
Jerry Dockham (R), Commissioner Appointed by Governor Pat McCrory in 2013; current term expires in 2019
Lyons Gray (R), CommissionerAppointed by Governor Pat McCrory in 2015; current term expires in 2021
The NC Energy Policy Council is required by statute to submit a comprehensive energy report providing a general overview of energy conditions in the state to the governor, legislative leaders, the Joint Legislative Commission on Energy Policy, the Environmental Review Commission and the chair of the Utilities Commission. During the 2013 legislative session, SB 76 (the Domestic Energy jobs Act) was passed and it modified the composition, leadership and duties of the EPC.
The plan highlights the following key points:
In recent years, NC has experienced a significant increase in natural gas use by utilities while use of natural gas in other sectors (residential, commercial and industrial)) has remained relatively unchanged; The NC Dept. of Commerce estimates drilling activities (in the state) would add an average 387 jobs each year over a 7 year period and positively affect the state’s GDP by $292 million; The state is engaged in developing offshore energy resources in the area of wind, oil and natural gas; Three major natural gas pipelines cross the state; In December 2015 Transco is expected to add a pipeline for transporting gas from the Marcellus to the south. The additional supply is expected to keep natural gas prices relatively low.
While North Carolina’s gas utilities are not required to implement energy efficiency plans, Piedmont Natural Gas and Public Service Co. of NC offer energy efficiency programs.
In 1998, the NC legislature passed the North Carolina Clean Water and Natural Gas Critical Needs Bond Act of 1998 which authorizes natural gas bonds for uneconomic line extensions.
The General Assembly has also enacted legislation for the creation of expansion funds for uneconomic line extensions; Gas utilities may only apply those funds to economically infeasible expansions or to expansion estimated to produce a negative net present value. These funds can come from a surcharge imposed on existing ratepayers, supplier refunds and other sources approved by the NC PUC.
In March of 2015, the North Carolina House took up HB 332, which would allow natural gas utilities to recover costs associated with expanding infrastructure to large manufacturing employers. Eligible businesses are defined as businesses that employ or intend to employ at least 1,500 full-time employees or equivalent full-time contract employees at the project at the time the application is made and the business agrees to maintain at least 1,500 full-time employees or equivalent full-time contract employees at the project. This bill was carried over into the 2016 legislative session.
On June 30, 2016, the NC General Assembly passed S. 673, which authorizes a natural gas economic development infrastructure rider. The mechanism allows natural gas local distribution companies to recover the infeasible portion of natural gas infrastructure to eligible projects in rates in a rider.
In order to use this mechanism, the North Carolina Department of Commerce must first determine that the natural gas infrastructure is for an eligible project. To be eligible, a project must meet all of the following conditions:
• The project will provide opportunities for natural gas usage, jobs and other economic development benefits;
• The business has invested or intends to invest at least $200 million in private funds for real and personal property;
• The business will employ or intends to employ at least 1,500 full time employees.
• The North Carolina Utilities Commission (NCUC) will permit costs for natural gas infrastructure to be recovered in a rider by an LDC for infrastructure related to projects approved by the Department of Commerce, if the Commission determines the project meets all of the following conditions:
• The project is located in an area where the natural gas infrastructure for the project is not economically feasible;
• The developer of the project, the prospective customer or the occupant of the project provides a binding commitment that the project will use the natural gas service for at least 10 years;
• The projected margin generated by the eligible project will not cover the cost of the natural gas infrastructure.
Once approved, the economically infeasible costs of the infrastructure will be recovered in a rider. The costs recovered in the rider will include the costs normally recovered for infrastructure, including the planning and development costs, construction costs, financing costs, depreciation, and property taxes. The rider may be allowed on an annual or semiannual basis, and will be subject to periodic reconciliation. The rider will terminate when the costs are fully recovered, or with the LDC's next general rate case, whichever occurs first.
A LDC may not invest more than $25 million a year in infrastructure development costs, and the amount recovered in the rider may not exceed 5% of the margin revenues approved in the last rate case of the LDC. The total amount of infrastructure costs that can be recovered by all LDC's in the state is limited to $75 million.
This bill was signed by the Governor on July 28, 2016.
In May 2013, the North Carolina General Assembly passed legislation that will authorize the NC PUC to adopt, implement, modify or eliminate a rate adjustment mechanism for natural gas local distribution company rates so that the utility can recover the prudently incurred costs associated with complying with federal gas pipeline safety requirements; Piedmont Natural Gas Company has applied for a tracker in accordance with this legislation as part of its recent rate filing.
In December of 2013, the NC PUC permitted Piedmont Natural Gas to implement an integrity management rider (IMR) that allows the company to track and recover future capital expenditures it expects to incur to comply with federal pipeline safety and integrity requirements outside of a general rate case. IMR filings are to occur annually, each November, to reflect costs incurred through the previous October, and the revised rates are to become effective the following February.
In March of 2015, Senator Robert Rucho (R) introduced Senate Bill 434, which would permit the NC PUC to adopt, implement, modify, or eliminate a rate adjustment mechanism to enable the company to recover the reasonable and prudently incurred capital investment and associated costs of complying with federal gas pipeline safety requirements, including a return based on the company's then authorized return. Costs incurred for routine maintenance, repair, and replacement of system components shall not be included in a rate adjustment mechanism authorized under this legislation. The Commission shall adopt, implement, modify, or eliminate a rate adjustment mechanism authorized under this section only upon a finding by the Commission that the mechanism is in the public interest. The Commission may eliminate or modify any rate adjustment mechanism authorized pursuant to this section upon a finding that it is not in the public interest. This bill died at the end of the legislative session.
On October 28, 2016, the North Carolina Utilities Commission (NCUC) adopted an amended stipulation which authorized Public Service Company of North Carolina (PSNC) an Integrity Management Tracker, which will allow PSNC to recover integrity management plant investment net of excluded costs. The NCUC defined excluded costs as the portion of capital expenditures related to system enhancement and system strengthening of a capital project that results in more volumes, higher pressure, or larger pipe sizes. At the time of PSNC’s next general rate case proceeding, all prudently incurred Integrity Management Plant Investment associated with this Rider will be included in base rates and the excluded costs will be eligible for inclusion in recoverable rate base.
Piedmont Natural gas owns a network of CNG stations in North Carolina and has a Natural Gas Vehicle Fuel rate schedule in its tariff (Rate Schedule 142).
PSNC Energy owns a network of CNG stations in North Carolina.
WEC Energy Corp. subsidiary Trillium CNG owns and operates stations in Charlotte and Faro.
Piedmont Natural Gas and Public Service Company of North Carolina utilize a Margin Decoupling Mechanism/Tracker (MDT), formerly known as the Customer Utilization Tracker (CUT) that decouples the recovery of authorized margins from sales levels.