Greenville Utilities proposes rate adjustments, outlines capital plan and PFAS response

Greenville Utilities Commission (GUC) General Manager Tony Cannon presented the commission’s proposed FY2025–26 budget and multi-year capital plan to the Greenville City Council on May 8, outlining proposed rate adjustments, major capital projects and the utility’s approach to PFAS detection in the water system.

Cannon said GUC serves roughly 73,000 customer connections with about 517 employees and described the utility’s historical role and charter under the North Carolina General Statutes. Over the last ten years GUC transferred about $71.3 million to the city’s general fund; Cannon said the upcoming transfer will be the largest ever at about $9.1 million and noted the transfer has averaged 7.8% of the city’s general-fund revenues in the last decade.

Key proposed rate changes for FY2025–26 include a 3.7% increase to electric rates, a 6.5% increase to sewer rates, a 4.9% increase to gas rates and no base increase to water rates in the utility’s proposal (Cannon described a formulaic wholesale water adjustment from $2.59 to $2.78 per unit). Cannon said electric increases are driven primarily by higher wholesale power costs and duly noted the utility’s use of an electric-rate stabilization fund to smooth rate volatility.

Cannon described major capital needs: an advanced metering infrastructure (AMI) replacement estimated at about $49 million phased over eight years; roughly $300 million of capital work across funds over five years (funded about half by cash and half by debt in the plan); transformer replacements and distribution upgrades; water-filter improvements to treat per- and polyfluoroalkyl substances (PFAS); and work to add peak-shaving generation capacity. He said a recent settlement with a third party allowed adding 20 megawatts of generation capacity and that GUC is building a 10-megawatt peak-shaving unit at McGregor Dam Substation with an estimated payback of about 3.5 years.

On PFAS, Cannon said detection of PFOA/PFOS at the 4 parts-per-trillion detection limit prompted GUC to test granular activated carbon (GAC) filtration; one GAC unit installed in 2023 performed effectively and the utility now estimates about $2.5 million to $5.5 million for plant-level work (Cannon cited $250,000 per filter for ten filters as one element) and ongoing annual operating costs of about $1 million to $2 million a year to manage GAC media and operation. He noted that part of the funding for PFAS responses may come from settlement proceeds the utility expects from chemtrail-related litigation settlements (DuPont/3M) but cautioned the amounts and timing are subject to legal outcomes.

Cannon said the budget and five-year forecast maintain key financial ratios (debt-service coverage, fund balance and days cash on hand) at levels the utility considers healthy; he reported Fitch affirmed GUC’s AA- rating and Moody’s indicated an Aa2 affirmation. The presentation included customer-satisfaction survey results (84% overall satisfaction from 694 respondents) and a recap of community and economic-development contributions by the utility.

Councilors asked about PFAS levels and treatment options, how true-up riders from Duke Energy were being recovered over multi-year spreads, and what the utility is doing to manage long-term grid needs and security. Cannon said the true-up associated with prior high wholesale costs is being amortized over 24 months to lessen abrupt rate impacts and that the utility continues to focus on reliability, affordability and succession planning. No council vote on GUC rates occurred at the meeting; the presentation was provided for council consideration in the budget process.