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In State of NC ex rel. Utils. Comm’n v. N.C. Waste Awareness Reduction, a Divided NC Court of Appeals Ruled that NC WARN is a Public Utility

On September 19, 2017, a divided panel of the NC Court of Appeals ruled that N.C. Waste Awareness Reduction (NC WARN) is a public utility for installing and maintaining solar panels on a Greensboro church and entering into a contract to charge the church for the energy generated. NC WARN had asked the NC Utilities Commission (NCUC) for a declaratory ruling that it was not a regulated public utility. The NCUC instead found that NC WARN was acting as a public utility by operating its system of solar panels and selling “the electricity produced by the system” to the church.

The majority opinion found that NC WARN was a public utility because it owns and operates “equipment and facilities” that provide electricity “to or for the public for compensation.” N.C.G.S. §62-3(23)(a) (2015). There was no dispute that NC WARN owns and operates “equipment and facilities” or that it provides electricity to the church for compensation. The main point of contention is whether NC WARN is providing the electricity to “the public.”

The majority relies on North Carolina’s statutory and policy decisions to create regulated monopolies for the provision of electric service to make sure that all of the public can be served at a reasonable price. It points to the “effect or non-regulation or exemption from regulation of one or more persons engaged in the industry” as a way of cherry-picking customers that could upset the electric utility marketplace.

The dissent argues that NC WARN is not providing electricity to the public, if the system of solar panels is “on the property of a single customer for that customer’s sole use.” Key to the dissenting opinion was that the church was the only customer for the system and that the NCUC had found that two similar situations were not considered public utilities.

NC WARN can appeal as of right to the NC Supreme Court based on the dissenting opinion.

 

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