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N.C. Expands Self-generation Deferral Rates

Fortnightly Magazine - September 1 1995

The North Carolina Utilities Commission (UC) has approved a North Carolina Power Co. plan to use its special self-generation deferral rate to persuade a large industrial customer to use utility supply for a planned plant expansion rather than existing self generation facilities. The UC rejected allegations that the discount to the Weyerhauser paper plant in Plymouth, NC, must pass a stricter analysis than past cases involving rate discounting guidelines because it applies to new load. According to the UC, the guidelines apply to discounted rates offered by a utility "to prevent immediate loss of load." Whether the utility is attempting to retain existing load or add additional load that is at-risk to self-generation, the UC found the standard for review the same (em that is, the utility should charge as high a rate for that load as possible. The UC agreed, however, that the economic benefit resulting from a discounted rate must be significant, not merely greater than zero, because future costs cannot be predicted with precision. Re North Carolina Power Co., Dkt. No. E-22, Sub 350, June 27, 1995 (N.C.U.C.).

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