RALEIGH — North Carolinians can’t lose their utility services until September, even after Gov. Roy Cooper let his executive orders on utility payments expire Wednesday, July 29.
In April, Cooper banned utility providers from disconnecting or fining non-paying customers. The orders started a political battle when rural towns warned that Cooper’s orders risked driving them into bankruptcy. State Treasurer Dale Folwell began urging Cooper to waive his orders, arguing they were devastating rural communities.
Cooper let the orders expire without asking the Council of State for another extension. But the N.C. Utilities Commission released an order on July 29 forbidding any utility shutoffs for nonpayment until Sept. 1. The commission’s order extends customers’ repayment period to at least one year. It also bans providers from charging late fees until the state of emergency ends.
Since April, more than 1.3 million residential customers became eligible to lose their water, gas, and electric services.
Under Cooper’s expired order, utility providers can’t disconnect customers for bills left unpaid during the past four months of the pandemic, and they must give customers at least six months to pay off those bills without charging interest. But they can cut off customers who don’t pay after July.
The issue could further polarize voters and widen the gulf between state and local governments in North Carolina, said Chris Cooper, a Western Carolina University political scientist.
“Cooper’s played the politics of COVID-19 very well up until this point,” Chris Cooper said. “He’s gotten the electoral credit for what’s perceived as trying to help folks out, and, if he’s able to cast any policy changes as a Republican problem, that’ll play into his hands.”
Since April, almost 14% of North Carolina customers stopped paying their utility bills. Utility providers are waiting for more than $257 million in late payments. The three largest utility companies in the state own almost 60% of those late payments, according to the N.C. Utilities Commission’s June report.
“Families are facing severe hardship. I think this executive order was very important to protect them,” Gov. Cooper said in a Council of State meeting July 7.
But Cooper’s orders also hit local governments hard. Local officials expect a 20% to 30% drop in sales tax revenue, along with shrinking fees. For some local governments that owned their own utilities, non-payments wrecked their finances.
The rural town of La Grange sued Cooper, accusing him of dragging the town into insolvency. Elizabeth City publicly announced its plans to defy his orders or go bankrupt. Its leaders warned of a 30% spike in utility rates after almost a third of its customers stopped paying their utility bills.
“It’s not just the citizens that need help, it’s the cities,” Folwell told Carolina Journal. “We’ve always known that in this case, one size fits none. And we’ve always known that one of the consequences of this executive order is that property taxes and utility rates will go up.”
If Folwell’s predictions come true, it probably won’t affect the election, says Chris Cooper.
“That’s certainly possible, but it will be too late,” Chris Cooper said. “Even if that’s true, that’s not the connection the average voter is going to make. … That’s an awful lot of math to your average voter.”
Duke Energy said that all customers will have at least one full billing cycle to make payment arrangements after the company announces a return to standard operations.
“Until we know more, we will continue to encourage customers who are, understandably, behind in their payments, to pay what they can now to avoid large bill balances that may be difficult to manage later,” Duke Energy said in a statement.
The Utilities Commission said the crisis has lasted much longer than anticipated. When it issued its first order banning utility shutoffs throughout the state of emergency, the commission thought the pandemic would be under control by the end of summer.
In its new order, the commission said it was concerned that letting bills accumulate could make it impossible for customers to repay their bills and providers to survive.
“The growing unpaid charges could potentially, contrary to the public interest, place continuation of utility service in some areas in jeopardy,” the commission wrote.
