Rocky Mount residents ought to be breathing a collective sigh of relief after news broke earlier this week of a deal between Duke Energy and the N.C. Eastern Municipal Power Agency.
The $1.2 billion deal announced Monday morning could lead to some real relief in the form of lower utility bills, which would be a real coup for an area that has been strapped with high electricity costs for longer than we care to remember.
Duke is purchasing the power agency’s ownership in five electricity generating assets. The 32 cities that make up the power agency will enter into a 30-year wholesale power supply agreement with Duke. And the massive debt load that kept ElectriCities utility rates so inflexibly high will be dramatically reduced.
All this, of course, hinges on state and federal approval. And many questions are unresolved at this stage. But we’ve used this space countless times to advocate for lower utility rates by any legal means necessary. Selling off the plants that saddled us with so much debt to begin with seemed like the best possible scenario, and we’re glad to see a deal get done.
According to Telegram staff writer Brie Handgraaf’s reporting, the deal, if approved, would reduce the power agency’s debt from approximately $1.9 billion to $480 million. Handgraaf reported that customers’ rates could be reduced to varying degrees depending on the city’s share of the outstanding debt and other factors.
By cutting the power agency’s debt by nearly 75 percent, our hope is that utility customers will see some significant savings. Local leaders have estimated that for every dollar a Rocky Mount customer is billed, 32 cents goes toward paying off debt.
The deal isn’t perfect. That $480 million in debt left on the books still stings and is going to hover over us for a while still. There is a light at the end of the tunnel. But it’s a pretty long tunnel. Early reporting suggests the deal might not be completed until the end of 2016. If customers see an immediate impact after the deal is done, that means lower utility bills in 2017.
Still, we can’t help but be excited by this turn of events after years of hearing that the problem of high rates was largely unsolvable. It’s been a long time coming, and there’s a long road ahead. But we’re encouraged by this progress and grateful to the tireless work of local leaders who pressed for a solution.