Appeals Court dumps latest legal dispute involving former Alcoa dams | Eastern North Carolina Now

Publisher's Note: This post appears here courtesy of the Carolina Journal. The author of this post is CJ Staff.

    A split 2-1 panel of the N.C. Court of Appeals has thrown out a case involving the proposed use of Yadkin River dams. The same dams once generated a long-running legal dispute involving state government.

    A company called Cube Yadkin Generation now owns the four dams and "hydroelectric generation facilities" near Badin. The company operates under a federal permit. It is exempt from state regulation as a public utility.

    But plans to use some of Cube's hydroelectric power for the nearby Badin Business Park led to a legal dispute. In 2019 Cube sought a declaration from the N.C. Utilities Commission. The company wanted to ensure that buying business park property and providing its tenants with electricity would not trigger additional regulation.

    The commission's Public Staff "expressed their support" for Cube's plan, according to the Court of Appeals' majority opinion. But Duke Energy objected, and the Utilities Commission ruled against Cube in September 2019.

    Now the Appeals Court has tossed out the case. "Cube has shown no evidence that it owns the legal right to lease the real property required to fulfill its Proposed Plan, has shown no evidence that it would be able to acquire that real property, and has presented only encouraging affirmations from potential tenants," wrote Judge Jefferson Griffin.

    Without moving forward with its plans, Cube has no "justiciable controversy," Griffin wrote. That means there's no legal dispute for courts to resolve.

    "Put another way, there is no certainty that Cube's position is actually adversarial to Duke's exclusive franchise service rights," Griffin wrote. "Cube claims to have a roster of signable players and assuredly possesses the basketballs, the jerseys, and an itch to blow that first whistle, but will never be allowed to play against Duke if the arena owner refuses to allow Cube on the court."

    The decision vacates the Utilities Commission order that was based on Cube's initial proposal.

    The case involves four dams that once pitted N.C. state government against previous owner Alcoa in court for almost eight years. Carolina Journal last reported on the controversy in 2015, when state regulators "issued a water quality permit to Alcoa, one of the final impediments preventing the company from receiving a new license from the Federal Energy Regulatory Commission to continue operating the dams, known collectively as the Yadkin Project. In recent weeks, the state had lost rulings in state Superior Court and U.S. District Court over the relicensing process."

    Alcoa had operated the dams since 1917. Its federal license expired in 2008. The company then operated the dams under a temporary license. "It began the relicensing process in 2002, but in 2008 state officials began throwing obstacles in Alcoa's way," Carolina Journal reported. "Democratic Govs. Mike Easley and Bev Perdue and Republican Gov. Pat McCrory each have opposed the relicensing. They wanted the state to take over the dams and operate the hydroelectric facilities."

    Part of the problem stemmed from the fact that Alcoa continued to own and operate the dams, even after shutting down an aluminum smelting plant in Badin that had provided local jobs. Most of the operation shut down in 2002, with all production stopping in 2007.

    The state's decision to grant a water-quality permit in 2015 helped end the earlier legal controversy. Alcoa sold the dams to Cube Hydro Carolinas in February 2017.