North Carolina Consumer Protection Act.

GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2025
H 1
HOUSE BILL 922

Short Title: North Carolina Consumer Protection Act. (Public)
Sponsors: Representatives Harrison, Hawkins, von Haefen, and Cervania (Primary
Sponsors).
For a complete list of sponsors, refer to the North Carolina General Assembly web site.
Referred to: Rules, Calendar, and Operations of the House
April 14, 2025
*H922-v-1*
A BILL TO BE ENTITLED 1
AN ACT THAT REVISES CERTAIN DEFINITIONS IN PUBLIC UTILITY LA W AND 2
ADDS ADDITIONAL REQUIREMENTS TO PROTECT RATEPAYERS FROM PAYING 3
UNJUST OR UNREASONABLE FEES TO PUBLIC UTILITIES. 4
The General Assembly of North Carolina enacts: 5
SECTION 1. G.S. 62-133.8 reads as rewritten: 6
"§ 62-133.8. Clean Energy and Energy Efficiency Portfolio Standard (CEPS). 7
(a) Definitions. – As used in this section: 8
(1) Advertising. – Any promotional activity aimed at increasing a public utility's 9
visibility, reputation, or profitability. This includes media campaigns, digital 10
marketing, and other promotional materials that do not address public service 11
issues or conservation efforts directly approved by a State or federal agency. 12
Advertising does not include any of the following: 13
a. Public messages that the public utility is directed to publish by a 14
federal, State, or local agency. 15
b. Public messages providing information on safety measures, 16
emergency conditions, or service interruptions. 17
(1)(1a) "Clean energy facility" means a Clean energy facility. – A renewable energy 18
facility, a nuclear energy facility, including an uprate to a nuclear energy 19
facility, or a fusion energy facility. 20
(1a)(1b) "Clean energy resource" means renewable Clean energy resource. – 21
Renewable energy resources, nuclear energy resources, including an uprate to 22
a nuclear energy facility, and fusion energy. 23
(1b)(1c) "Combined heat and power system" means a Combined heat and power 24
system. – A system that uses waste heat to produce electric ity or useful, 25
measurable thermal or mechanical energy at a retail electric customer's 26
facility. 27
(1d) Commission. – The North Carolina Utilities Commission created under 28
G.S. 62-10, which regulates public utilities in North Carolina. 29
(2) "Demand-side management" means activities, Demand-side management. – 30
Activities, programs, or initiatives undertaken by an electric power supplier 31
or its customers to shift the timing of electricity use from peak to nonpeak 32
demand periods. "Demand-side management" includes, but is not limited to, 33
General Assembly Of North Carolina Session 2025
Page 2 House Bill 922-First Edition
load management, electric system equipment and operating controls, direct 1
load control, and interruptible load. 2
(3) "Electric power supplier" means a Electric power supplier. – A public utility, 3
an electric membership corporation, or a municipality that sells electric power 4
to retail electric power customers in the State. 5
(3a) "Electricity demand reduction" means a Electricity demand reduction. – A 6
measurable reduction in the electricity demand of a retail electric customer 7
that is voluntary, under the real -time control of both the electric power 8
supplier and the retail electric customer, and measured in real time, using 9
two-way communications devices that communicate on the basis of standards. 10
(4) "Energy efficiency measure" means a n Energy efficiency measure. – An 11
equipment, physical, or program change implemented after January 1, 2007, 12
that results in less energy used to perform the same function. "Energy 13
efficiency measure" includes, but is not limited to, energy produced from a 14
combined heat and power system that uses non -clean energy resources. 15
"Energy efficiency measure" does not include demand-side management. 16
(4a) "Fusion" means a Fusion. – A reaction in which at least one heavier, more 17
stable nucleus is produced from two ligh ter, less stable nuclei, typically 18
through high temperatures and pressures, emitting energy as a result. 19
(4b) "Fusion energy" means the Fusion energy. – The product of fusion reactions 20
inside a fusion device, used for the purpose of generating electricity or other 21
commercially usable forms of energy. 22
(4c) Lobbying. – Any action undertaken to influence or attempt to influence 23
legislative or executive action, or both, as defined under G.S. 120C-100, as 24
well as any activity undertaken to influence regulatory matters, such as 25
rate-making. 26
(4c)(4d) "New clean energy facility" means:New clean energy facility. – Includes 27
either of the following: 28
a. A new renewable energy facility; orfacility. 29
b. Facilities placed into service on or after January 1, 2007, which are 30
either (i) a nuclear energy facility, including an uprate to a nuclear 31
energy facility, or (ii) a fusion energy facility. 32
(5) "New renewable energy facility" means a New renewable energy facility. – A 33
renewable energy facility that either:includes one of the following: 34
a. Was placed into service on or after January 1, 2007. 35
b. Delivers or has delivered electric power to an electric power supplier 36
pursuant to a contract with NC GreenPower Corporation that was 37
entered into prior to January 1, 2007. 38
c. Is a hydroelectric power facility with a generation capacity of 10 39
megawatts or less that delivers electric power to an electric power 40
supplier. 41
(5a) Political influence activities. – Includes any of the following: 42
a. Any activity intended to directly or indirectly affect or attempt to affect 43
the decisions or actions of public officials, including , but not limited 44
to, contributions or direct expenditures to political campaigns, parties, 45
or advocacy groups. 46
b. An activity for the purpose of directly or indirectly influencing public 47
opinion with respect to (i) legislation, regulations, or ordinances, (ii) 48
elections, (iii) refe renda, or (iv) rate setting of electrical or gas 49
corporations. 50
General Assembly Of North Carolina Session 2025
House Bill 922-First Edition Page 3
c. An activity for the purpose of directly or indirectly influencing either 1
of the following: 2
1. The possible adoption of federal, State, or local legislation, 3
regulations, or ordinances. 4
2. The possible repeal or modification of federal, State, or local 5
legislation, regulations, or ordinances. 6
d. An activity for the purpose of dire ctly or indirectly influencing 7
elections or referenda, or appointments of public officials. 8
e. An activity for the purpose of directly or indirectly influencing the 9
approval, modification, or revocation of franchises of public utilities. 10
f. An activity und ertaken in support of lobbying or legislative action, 11
including, but not limited to , research, analysis, preparation, or 12
planning, whether done directly or indirectly on behalf of the public 13
utility. 14
(5b) Public official. – A decision maker within an administrative agency or 15
legislative body at the local, State, or federal level, and the staff that support 16
the decision maker's policy development. 17
(5c) Public utility. – A utility company providing services related to electricity, 18
gas, water, or telecommunications as defined in G.S. 62-3. 19
(5d) Rate base. – The value of a public utility's property that is used to determine 20
its rate of return and the revenues required to cover operating costs and 21
provide a reasonable return as defined under G.S. 62-133. 22
(5e) Regulatory matters. – Any issues, processes, or activities directly related to 23
the oversight, implementation, or enforcement of statutes, rules, or policies 24
administered by government agencies or regulatory bodies such as the North 25
Carolina Utilities Commission or Department of Environmental Quality. This 26
includes actions involving compliance with regulatory standards, the 27
establishment or amendment of regulations, enforcement actions, rulemaking 28
processes, and participation in administrative or legal proceedings concerning 29
the regulation of public utilities. 30
(6) "Renewable energy certificate" means a Renewable energy certificate. – A 31
tradable instrument that is equal to one megawatt hour of electricity or 32
equivalent energy supplied by a clean energy facility, new clean energy 33
facility, or reduced by implementation of an energy efficiency measure that is 34
used to track and verify compliance with the requirements of this section as 35
determined by the Commission. A "renewable energy certificat e" does not 36
include the related emission reductions, including, but not limited to, 37
reductions of sulfur dioxide, oxides of nitrogen, mercury, or carbon dioxide. 38
(7) "Renewable energy facility" means a Renewable energy facility. – A facility, 39
other than a hydroelectric power facility with a generation capacity of more 40
than 10 megawatts, that either:includes one of the following: 41
a. Generates electric power by the use of a renewable energy resource. 42
b. Generates useful, measurable combined heat and power der ived from 43
a renewable energy resource. 44
c. Is a solar thermal energy facility. 45
(8) "Renewable energy resource" means a Renewable energy resource. – A solar 46
electric, solar thermal, wind, hydropower, geothermal, or ocean current or 47
wave energy resource; a bi omass resource, including agricultural waste, 48
animal waste, wood waste, spent pulping liquors, combustible residues, 49
combustible liquids, combustible gases, energy crops, or landfill methane; 50
waste heat derived from a renewable energy resource and used to produce 51
General Assembly Of North Carolina Session 2025
Page 4 House Bill 922-First Edition
electricity or useful, measurable thermal energy at a retail electric customer's 1
facility; or hydrogen derived from a renewable energy resource. "Renewable 2
energy resource" does not include peat, a fossil fuel, or nuclear energy 3
resource. 4
(9) Test-year method. – A method of determining the appropriate rate adjustments 5
for public utilities based on the actual and projected costs, as outlined in 6
G.S. 62-133. 7
…." 8
SECTION 2. G.S. 62-131 reads as rewritten: 9
"§ 62-131. Rates must be just and reasonable; service efficient. 10
(a) Every rate rate, toll, charge, schedule made, demanded or received by any public 11
utility, or by any two or more public utilities jointly, shall be just and reasonable. Such rates, 12
tolls, or charges will only be deemed reasonable if all of the following criteria are satisfied: 13
(1) Revenue limits – The public utility demonstrates that the aggregate rates 14
provide revenues that are no greater than the actual costs incurred in serving 15
North Carolina customers, including reasonable normali zation for 16
nonrecurring costs and future adjustments as approved by the Commission, 17
and a fair return on the public utility's rate base. 18
(2) Prohibited costs. – The public utility demonstrates that no part of its rates, 19
tolls, or charges includes recovery of costs related to the following: 20
a. Advertisements if any portion of the message in an advertisement is 21
considered advertising. 22
b. Lobbying, grassroots lobbying, executive or legislative advocacy, 23
regardless of whether such lobbying or advocacy is undert aken 24
directly or indirectly on behalf of a public utility. 25
c. Contributions or gifts to political candidates, political parties, political 26
or legislative committees or any committee or organization working to 27
influence legislative activities, referendum petitions, or elections. 28
d. Membership dues, sponsorships, or contributions to any business or 29
industry trade association, group, or tax -exempt related entity, 30
including, but not limited to , chambers of commerce, charitable 31
organizations, charities managed b y the public utility or affiliated 32
interest, industry groups, and organizations classified under section 33
527 of the Internal Revenue Code. 34
e. Political influence activities. 35
f. Legal costs and litigation related to federal, State, or local regulations, 36
legislation, ordinances, or regulatory proceedings, including actions 37
against regulatory bodies or legislative decisions. 38
g. Travel, lodging, food, and beverage expenses for the utility's board of 39
directors, officers, or for the parent company 's board or o fficers, 40
including any related expenses for affiliate boards or officers. 41
h. Any costs associated with investor relations activities, including , but 42
not limited to , communication, reporting, or any other promotional 43
activities intended for investors or stakeholders. 44
i. Compensation for any employee whose time is allocated to activities 45
related to lobbying, legislative action, political influence activities, or 46
advertising, marketing, or communications seeking to influence public 47
opinion. 48
j. Entertainment or gifts. 49
k. Leasing, owning, or chartering an aircraft for use by the public utility's 50
board of directors or officers, or those of a parent company or affiliate. 51
General Assembly Of North Carolina Session 2025
House Bill 922-First Edition Page 5
l. Expenses related to services not regulated by the Commission. 1
m. Any other lobbying or political activity that is conducted in support of 2
a candidate committee, a political committee, or an inaugural 3
committee, or in support of or opposition to a candidate for public 4
office, regardless of whether such actions are undertaken directly or 5
indirectly on behalf of a public utility. 6
(3) Fair classifications. – Rates must equitably classify customer groups and 7
ensure fairness across all categories, including residential, commercial, and 8
industrial customers. 9
(b) Every public utility shall furnish adequate, efficient and reasonable service. 10
(c) In determining costs of service, the Commission may apply a test -year method of 11
estimating revenue needs, utilizing appropriate normalization and adjustments as required. 12
(d) The Commission may approve special rates or contracts for individual customers or 13
customer classes if it determines that such measures are in the public interest, do not unreasonably 14
burden other customers, and align with State emissions reductions goals." 15
SECTION 3. Article 7 of Chapter 62 of the General Statutes is amended by adding 16
new sections to read: 17
"§ 62-131A. Prohibited cost recovery; annual reporting. 18
(a) Public utilities regulated under this Chapter cannot attempt to recover in rates any 19
costs related to the Prohibited Costs listed in G.S. 62-131(a)(2). 20
(b) By July 1 of each year, regulated public utilities shall submit to the Commission an 21
annual report detailing all of the following: 22
(1) A written, itemized description of any expenses associated with prohibited 23
activities in G.S. 62-131(a)(2). 24
(2) For each expense, the report must include the date, the payee, the amount, and 25
a description of the purpose of the expense. 26
(3) Third-party expenditures for prohibited activities, with details sufficient to 27
describe the nature of the expenditure regarding payees and purposes. 28
(4) A list of all divisions, departments, or other organizational employee groups 29
within the public utility that performs activities associated with 30
G.S. 62-131(a)(2). For each organizational employee group, the public utility 31
shall include a list of employees who work in that group. For each employee, 32
the public utility shall include the employee 's job title, a job description 33
sufficient to describe the employee 's responsibilities, each activity described 34
in G.S. 62-131(a)(2) in which the employee engages, and a description 35
sufficient to describe the nature of any such activity, the total annual 36
compensation for the employee, the hours allocated to the activity, the 37
percentage of annual compensation paid for work associated with the 38
activities described in G.S. 62-131(a)(2), and the percentage of annual 39
compensation recoverable from ratepayers. 40
(5) Any additional information that the Commission deems relevant. 41
(c) The Commission shall review the reports submitted under this section, ensuring they 42
comply with the requirements outlined in this act. The Commission may request additional 43
clarification or docum entation to ensure compliance. If any violations are identified, the 44
Commission shall act promptly to enforce penalties as outlined in subsection (e) of this section. 45
(d) Public Disclosure. – A public utility shall do all of the following: 46
(1) Clearly and conspicuously disclose in all its public messaging and advertising 47
whether the costs of the public messaging or advertising are being paid for by 48
the corporation 's shareholders or ratepayers. A disclosure is not clear and 49
conspicuous if the disclosure is difficult to hear or read, or if the placement of 50
the disclosure is easily overlooked. 51
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(2) Publish on its publicly accessible website all materials filed with the 1
Commission in accordance with subsection (b) of this section . The 2
Commission shall make available the annual reports filed by public utilities in 3
accordance with this section on its publicly accessible website with notice of 4
the availability of the reports prominently displayed on the website. 5
(e) The Commission shall impose penalties on public utilities that recover prohibited 6
costs through rates, equal to the amount improperly recovered and refund them to the ratepayers. 7
The Commission shall also satisfy all of the following: 8
(1) In addition to any refunds that the Commission orders a public utility to pay 9
ratepayers, the Commission shall assess a civil penalty in accordance with this 10
section against a public utility that violates G.S. 62-131(a)(2) or fails or 11
neglects to comply with any part or provision of any order, decision, decree, 12
rule, direction, demand, or requirement of the Commission related to 13
implementing G.S. 62-131(a)(2). 14
a. This civil penalty will not be less than fifty thousand dollars ($50,000) 15
and not more than one hundred fifty thousand dollars ($150,000) for 16
each violation. 17
b. Each expense improperly recorded to cost recovery through ratepayers 18
is a separate and distinct violation. Violations are continuing 19
violations. Each day a violation to G.S. 62-131(a)(2) occurs shall be a 20
separate and distinct violation. 21
c. The public utility shall not recover any penalty assessed pursuant to 22
this section from ratepayers. 23
(2) Three-fourths of the monies collected pursuant to any settlement or penalties 24
collected by the Commission for violations of G.S. 62-131(a)(2) shall be 25
deposited in the "Energy Equity Fund ," which is hereby established in the 26
State Treasury. 27
(3) One-fourth of the monies collected pursuant to any settlement or penalties 28
collected for violations of G.S. 62-131(a)(2) shall, upon appropriation by the 29
General Assembly, be used by the Commission for purposes of increasing 30
resources for the enforcement of this section. 31
(4) Upon appropriation by the General Assembly, monies in the "Energy Equity 32
Fund" may be allocated for purposes of disaster recovery and relief, as well 33
as assisting low -income households in transitioning to zero -emission 34
appliances to mitigate air quality and public health impacts of using 35
combustion appliances. 36
"§ 62-131B. Guidelines for special rates and alternative regulatory plans. 37
(a) The Commission may adopt alternative regulatory mechanisms, including 38
performance-based rates or special customer rates, provided that such measures accomplish all 39
of the following: 40
(1) Protect the public interest. 41
(2) Ensure equitable treatment across customer classes. 42
(3) Do not compromise the reliability of electric service. 43
(b) Before approving any alternative reg ulatory plan, the Commission shall ensure that 44
the plan will not increase costs for other customers beyond reasonable limits or conflict with 45
State energy goals, including renewable energy deployment. 46
(c) By November 1, 2025, the Commission shall initiate rulemaking to amend its rules 47
under G.S. 62-30 to implement the requirements of this act. The Commission's rules shall not 48
require public utilities to file more than one annual report related to advertising and political 49
activities, except as required under G.S. 62-133.6." 50
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SECTION 4. If any provision of this act or its application is held invalid, the 1
invalidity does not affect other provisions or applications of this act that can be given effect 2
without the invalid provisions or applicatio n and, to this end, the provisions of this act are 3
severable. 4
SECTION 5. This act is effective when it becomes law. 5