Duke Energy’s lost taxable value was due to consolidation planned in 2018

ROCKINGHAM — The $63 million drop in Duke Energy’s taxable value in Richmond County was due to a consolidation the company had been planning since 2018 but which the county was not made aware of.

Duke Energy deals directly with the North Carolina Department of Revenue each year to determine its valuation, and was under “no obligation” to inform the county about this incoming loss, County Manager Bryan Land said. Grace Rountree, a spokesperson for Duke, explained that the company has inventory of maintenance parts, poles, wire and more spread across its service area. Duke determined that it would be “more efficient” to move some of this inventory out of Richmond County to Gaston County, on the western side of Mecklenburg County which Rountree said is more “centrally-located” in its service area, resulting in this loss.

“Duke Energy continuously looks for ways to save customers money by operating more efficiently and effectively as we build a cleaner energy future. One way we are doing this is by consolidating our inventory,” Rountree said in an email. “In 2018 in Richmond County, we identified options to consolidate our inventory at the Smith Energy Complex to a more centrally-located location in Gaston County.”

She added that while these transfers were not communicated to the county, “(Duke is) happy to provide such information in the future.”

Making this move allowed the company to lower costs for its customers, according to Rountree.

“While there are impacts to property taxes in Richmond County where the assets were originally stored, this work benefits our customers over the long-term,” Rountree said. “And, we continue to find ways to support all of the counties we operate in through other taxes we pay and Foundation charitable giving.”

In an email Land sent on the evening of Sept. 15 to all the members of the Richmond County Board of Commissioners, he said that the county had seen a net loss of $61,938,020 in the county’s total assessed value. Duke Energy Progress Inc. alone showed a loss of $63,876,333, or about 12% of their value in 2019.

“In comparison to the amount we had budgeted, we lost $75 million in value at the drop of the hat!” Land wrote in his email to the commissioners. “To put this into perspective, this is the equivalent of losing the value of Weatherstone, Pinelakes, Lakestone, & Stone Henge subdivisions and Midway Road Industrial Park over night!”

Richmond County is currently disputing the figures from the Department of Revenue, but Rountree said the numbers are “correct based on the Duke Energy assets that were moved out of our Richmond County facility in 2018.”

“We are still waiting patiently on a response from the State,” Land said in an email Wednesday.

Fourteen out of a total of 33 Richmond County public utilities showed losses for 2020, and while Duke lost the most in value by far — the next highest loss by a single company was by Piedmont Natural Gas, which lost $1,210,068, or 2.5% of their 2019 value — other companies showed greater losses in proportion to their total. For comparison, Spectrum Advanced Services lost only $265,737 from 2019 to 2020, but this represented 20.6% of their 2019 value.