Mayor on Duty

Let me do a brief follow up to several items covered at the last Highlands Town Board. It was a unique session with the swearing of Marc Hehn, a new commissioner, and the swearing of Commissioners Buz Dotson and Brian Stiehler for new four-year terms.

Kevin O’Donnell, our Nova Energy consultant, gave an update on the status of the town’s Duke Energy wholesale electric contract. The contract is complicated and fluid. Kevin monitors the continuous execution of the contract to insure our interests are represented. He challenged a charge in this year’s contract that netted the town a $64,000 refund.  Refunds are applied toward operating costs to help keep rates down. For at least four years we have no significant rate increases. That has not been the case with Duke retail customers. Kevin informed us that Duke retail customers may be facing a built in 50% rate increase over the next decade to cover the rebuilding Duke’s electric grid. As a wholesale customer, the Town of Highlands will not be a part of these rate increases.

With that said, Kevin does expect Duke to increase our wholesale rate next year. There is a rate formula in our contract with Duke that determines these increases. For several years we have not passed these increases to customers, but coming years may be different.

Coal ash fees were again brought up by Kevin. The NC Utilities Commission granted 100% of the costs Duke requested for coal ash recovery. That ruling meant higher fees for Duke customers. The NC Attorney General and the NC Utilities Public Staff filed a suit that will be heard by the NC Supreme Court. The plaintiffs contend that the NC Utilities Commission awarded Duke excessive recovery costs when compared to similar cases in nearby states. If the court rules for the plaintiffs, there’s a good chance the current coal ash fees could be reduced.

In 2028 the town will have to renegotiate a contract with Duke, or find another supplier. Kevin advised us to start this process around 2025. It will be important to explore opinions concerning how and with whom to purchase electricity.

The new fire station is moving forward. The board approved a request to seek qualifications for a contractor manager position. This position would oversee the entire building construction. The contractor/manager would call for bids from subcontractors for all building phases. The manager would consult with the town and architect in determining which subcontractors made the best bids. This type of construction management has proven to be an effective way of containing building costs.

I also appointed members of the board to working committees for next year. These committees work with staff in studying specific issues and making proposals and recommendations to the entire board. For example, we have a public safety committee, a land use committee, a finance committee and a recreation committee to name just a few. I will be appreciative of all the time and work the committees will do this year.

  • Town of Highlands Mayor Pat Taylor

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