Duke Energy's inside connections to the McCrory administration
Following Duke Energy's massive coal ash spill into the Dan River, North Carolina state officials have come under scrutiny for their actions leading up to the disaster.
Last week the news broke that the N.C. Department of Environment and Natural Resources (DENR) and the Charlotte, N.C.-based utility giant are the subjects of a federal criminal investigation for a "suspected felony." The news of the investigation came shortly after the Associated Press reported that environmental groups tried three times to use the federal Clean Water Act to force Duke Energy to clean up its chronically leaking coal ash pits only to have their efforts stymied by DENR, which intervened at the last minute and forged settlements with relatively minor fines -- just over $99,000 for a company that just reported 2013 earnings of $2.68 billion -- and no cleanup requirements.
Adding to environmentalists' concern is the fact that Gov. Pat McCrory worked for Duke Energy for 28 years and received over $300,000 in direct campaign contributions from the company's political action committee and its employees, former employees, and their spouses. In all, McCrory's 2008 and 2012 gubernatorial campaigns benefited from a total of $1.1 million in political spending by Duke Energy, according to an analysis by Democracy North Carolina. It remains unknown whether the Renew North Carolina Foundation, a pro-McCrory shadow campaign committee, received money from Duke Energy because the 501(c)(4) tax-exempt group does not disclose its donors.
In addition, McCrory still holds a substantial amount of stock in Duke Energy, though he has refused to say exactly how much. That has led some watchdog groups to call on McCrory to recuse himself from appointing members of the N.C. Utilities Commission -- a call he has rejected.
But McCrory is not the only member of his administration with close ties to Duke Energy and its Progress Energy subsidiary. Other former Duke/Progress employees who hold high-level positions in North Carolina state government include:
* Joseph Harwood, DENR ombudsman. During McCrory's campaign for governor, he singled out DENR as a state agency that he considered to be unfriendly to business. To address that concern, John Skvarla, a businessman who McCrory named DENR secretary, created the position of DENR ombudsman -- and appointed to the post Joseph Harwood, a former Duke Energy employee.
Harwood, who served on McCrory's DENR transition team*, worked at Duke Energy for 38 years in various roles, including vice president for state government affairs. He went on to found Harwood and Associates, an energy consulting and government relations firm based in Cornelius, N.C. Incorporated in 2012, the privately-held firm specializes in project development in North Carolina and other southeastern states.
In addition to serving as DENR's ombudsman, Harwood also chairs the advisory board for the agency's Environmental Stewardship Initiative, a voluntary program launched in 2002 to engage companies in efforts to reduce their environmental impact.
* DENR Communication Director Drew Elliott. Harwood is not the only high-ranking member of Skvarla's team who comes from the utility industry: His communications chief previously worked for Raleigh, N.C.-based Progress Energy, which in 2012 became a subsidiary of Duke Energy.
Elliott was named DENR's communication director after serving as assistant chancellor for communications at for-profit South University in Savannah, Ga. Before that, he spent four years coordinating communications for Progress Energy.
In announcing their appointments, Skvarla said Harwood and Elliott were "well-suited to bring together the concepts of communications, business acumen and customer relations necessary in an environment friendly to the people we serve."
* Tony Almeida, former economic adviser. Almeida served as McCrory's senior adviser for jobs and the economy until stepping down earlier this month to spend more time with his family. In the position, he helped McCrory develop a jobs plan and reorganize the commerce department.
Before joining the administration, Almeida spent 32 years working for Duke Energy, where he served for a time as the company's vice president of economic development and supervised McCrory. In his role with the McCrory administration, Almeida pushed to ease regulations and to promote fracking and offshore drilling.
Almeida's ties to Duke Energy were cited in a complaint that the environmental group Food & Water Watch filed last year with N.C. Attorney Roy Cooper (D) asking him to probe possible fracking conflicts of interest in North Carolina government. Duke Energy is moving away from coal-fired power generation toward natural gas, including at the Dan River Steam Station where the coal ash spill occurred this month.
Almeida said he wanted to make DENR more "about helping businesses navigate the permitting process" and "more customer-focused."
* Commerce Secretary Sharon Decker. As head of the North Carolina Commerce Department, Decker is involved in overseeing the state's move of its job recruiting and marketing functions to a new public-private partnership -- an effort that has sparked controversy because of its speed and reach.
Before joining the administration, Decker had extensive private-sector experience, including more than 17 years with what was then known as Duke Power Co., now Duke Energy.
"She began working with the company in consumer services and moved rapidly through the ranks to become the youngest and first female vice president in Duke Power's history," McCrory said in announcing her appointment. "Her work at Duke Power led to the creation of its 24-hour customer service center, an organization that still serves as a model for the industry."
* Office of State Human Resources Director Neal Alexander. Before being named to lead human resources for state government, Alexander spent 40 years working in human resources at Duke Energy. There he most recently served as vice president for human resources for Duke Energy's U.S. Franchised Electric and Gas Service.
In announcing his appointment of Alexander, McCrory praised his "valuable merger and divestiture experience having worked through numerous organizational restructures and realignments." That includes Duke Energy's 2005 acquisition of Cinergy, a Cincinnati-based energy company.
(* One the three-co-chairs of the DENR transition team was Lyons Gray, a Winston-Salem businessman and former state legislator who now serves as McCrory's revenue secretary. According his economic interest statement filed last year, Gray and his wife own at least $10,000 in Duke Energy stock.)
Sue is the editorial director of Facing South and the Institute for Southern Studies.