Free-market minded grassroots activist group FreedomWorks has set up an online petition that calls upon Duke Energy’s board of directors to fire CEO Jim Rogers:
Due to ethical and business issues that have damaged the reputation of Duke Energy and put shareholders and ratepayers at risk, we urge you to exercise your fiduciary responsibility as board members and dismiss Jim Rogers from his position as chief operating officer (Rogers is actually CEO).
FreedomWorks identifies four reasons why Rogers should be dismissed. He has grown quite cozy with the Obama administration and the Democratic Party, to the point where he used Duke resources to back a $10 million loan for the organizers of the party’s 2012 National Convention in Charlotte, NC, which the National Legal and Policy Center reported about a couple of weeks ago.
Another reason cited is Rogers’s passionate support for the failed (nationally) cap-and-trade policy, also favored by President Obama and the majority of Democrats, which would have led to a disastrous system of Enron-type gaming of carbon credit markets and higher electricity costs. Duke is still part of the U.S. Climate Action Partnership, which calls for “significant reductions of greenhouse gas emissions.” Rogers supported cap-and-trade despite his acknowledgment that it would raise electricity rates by 40 percent and that there would be a huge fight for the proceeds from such a scheme.
Finally FreedomWorks alleges that Rogers is ethically compromised because of a scandal surrounding Duke’s coal gasification plant at Edwardsport, Indiana. They allege “gross mismanagement” that has led to a $900 million overrun on the project, and that there was improper correspondence between Rogers and a top Indiana regulator about settling over the plant’s costs. From The Charlotte Observer:
Exchanges of personal e-mails between Duke officials and regulators cost the jobs of former Duke Energy Indiana president Mike Reed and former commission chairman David Hardy last year. Jim Turner, former president of Duke’s regulated gas and electric businesses, resigned in December after a newspaper published friendly messages to and from Hardy.
Last November, Rogers testified he knew of no improper communications involving the Edwardsport, Ind., power plant, which has had large cost overruns….
Customers will pay some of the overruns, but Duke could be forced to swallow the rest.
On Monday (March 7), Rogers filed an addendum. A review of 9,000 e-mails found some that “taken together, might be construed to suggest” that Hardy and Reed talked about settling the cost issue. Indiana law prohibits substantive private communications about pending cases.
Of course, Duke is worried about having to eat the costs (harming shareholders) rather than passing them on to customers. According to a construction industry publication, “Duke’s management of the Project provides an example of how not to handle a project that faces significant cost increases.” Consumer and environmental groups had warned, the Indianapolis Star reported, that the gasification plant was “not needed, uses unproven technology and is too expensive.”
FreedomWorks appealed to the Duke Energy board:
These matters raise serious financial, ethical and legal issues that have the potential to negatively impact shareholders and customers alike. We urge you to hold Jim Rogers accountable for these lapses and take action by dismissing him from his position as chief operating officer of Duke Energy.
As NLPC reported last month, Rogers soon may have someone who has a better grasp of reality ready to step in for him in Progress Energy CEO Bill Johnson, after the two utilities complete their merger. Johnson has been recently warning of a “coming train wreck” due to excessive government regulations of the energy industry.
Paul Chesser is associate fellow for the National Legal and Policy Center and is executive director of American Tradition Institute.
Related:
Duke Energy CEO Rogers Plays Politics With Shareholder Money; $10M Credit Line for Democrats