Duke Energy plans to ask regulators for permission to issue storm bonds to cover hundreds of millions of dollars in expenses for replacing about 2,000 transformers, more than 12,000 power poles and other infrastructure destroyed during Tropical Storm Helene.
If issuance of the bonds is approved by the N.C. Utilities Commission, customers of the Charlotte-based utility would repay the debt starting in late 2025 or early 2026, company spokeswoman Logan Stewart said in an email.
While Duke hasn’t made an estimate for Helene-related costs in North Carolina, Stewart said the North Carolina Office of State Budget and Management projects the cost for all electric utilities, including Duke Energy, around $1.4 billion.
In the five weeks since flooding and mudslides devastated western North Carolina and caused major damage in Upstate South Carolina, Duke said its “limited remaining outages are largely concentrated in communities where broader recovery efforts are being coordinated due to catastrophic damage to buildings and infrastructure.’’
The utility said it has restored power to 2.7 million customers in the Carolinas, including more than 1.4 million in the Tar Heel State.
In Upstate South Carolina, Duke had to rebuild much of its severely damaged grid infrastructure that sends electricity to distribution lines serving homes and businesses, according to Stewart.
Buncombe, Henderson, Mitchell and northern McDowell counties were hardest hit in North Carolina, where destruction forced the repair of substations, poles, power lines and other transmission and distribution infrastructure.
The utility deployed more than 21,000 workers across the Carolinas for what it described as “an unprecedented response” to restore electricity. Drones helped access damage and crews used helicopters to set utility poles in Chimney Rock State Park, one of numerous areas with limited access due to the destruction of roads, Stewart said.
Helicopters helped speed the process significantly, Duke senior construction manager Jeff Waldroup said in a YouTube video. “We’ve had several inaccessible broke poles due to the roads being washed out.”
In Asheville, where marketing welcoming back tourists has begun, line workers hiked rough terrain to help restore electricity to the Veterans Administration hospital with a temporary line.
Crews are removing broken poles, transformers and Duke Energy debris.
East of the mountains, flooding of the Catawba River led to property damage downstream from Lake Norman. Duke’s release of floodwater led to the overflow of smaller Mountain Island Lake, damaging and destroying some homes in Gaston and Mecklenburg counties.
Many residents in downstream communities believe that “Duke purposefully allows places like Mountain Island Lake to flood in order to protect more expensive properties on Lake Norman,” according to an article by Carolina Public Press.
After a 2019 flood, a group of homeowners on Mountain Island Lake settled a lawsuit with Duke over alleged negligence in how the company handled the situation, according to the article.
Utility spokeswoman Jennifer Garber told the publication the company began communicating with local governments in potential flood zones days before Helene’s arrival. Emergency management officials from Mecklenburg and Gaston counties confirmed those communications, the article said.
As it seeks permission to issue storm bonds, Duke said customers’ costs for repaying the debt would be offset by reduced electric rates, due to declining fuel costs, Stewart said. A rate reduction ordered by the commission in August will take effect for customers of Duke Energy Progress Dec. 1 and Duke Energy Carolinas a month later.
Financing repair costs following storms in 2018 and 2019 saved customers $300 million on future bills, according to Stewart. Residential customers of Duke Energy Progress using 1,000 kilowatt hours of electricity per month were going to pay about 37% less compared with costs for traditional storm recovery, the company said in 2021.
In Helene’s aftermath, the utility said it expects its rates to remain below the national average even after the storm costs.
Duke Energy Carolina provides electricity to 2.9 million customers in the Carolinas, including Charlotte, Durham and the Triad. Duke Energy Progress serves Raleigh, eastern North Carolina and Asheville, at the epicenter of Helene’s devastation in late September.
Earlier this month, Gov. Roy Cooper and his aides estimated western North Carolina’s recovery from Hurricane Helene will ultimately consume about $53.6 billion from governmental and private sources.
