Regulations create wide-ranging costs for coal-ash cleanups

Power companies and their customers are spending billions to meet state and federal coal ash cleanup standards. But as ratepayers will soon find out, some regulations are costlier than others — and those in North Carolina could be among the hardest hit.

Customers across the nation can expect rising energy bills thanks to new regulations on how to dispose of coal ash. But the regulatory cost of coal ash cleanup, which typically falls to ratepayers, varies widely from state to state.

In North Carolina, Duke Energy could pay up to $10 billion to excavate and remove 32 coal ash basins at 14 power sites. Jeff Brooks, a Duke Energy spokesman, said estimating costs is tricky work, however, as costs fluctuate based on a range of factors.

“We base our ash basin closure costs on available information we have in hand, including costs for similar activities we have conducted in other aspects of our business,” Brooks told Watchdog.

Since cleaning up coal ash sites is relatively new, financial managers tasked with estimating costs draw information from past activities such as grading, trucking and hauling, and use benchmarking to develop solid comparisons. For factors Duke doesn’t have hard data on, engineers and project estimators engage in “probability weighting” based on science and engineering studies.

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