Documents reveal Cooper used ACP permit as leverage in deal between Duke and solar companies

RALEIGH, NC (WBTV) – Documents released by the Cooper Administration last month show senior staff delayed signing off on a key permit for the Atlantic Coast Pipeline until Duke Energy, one of the pipeline’s major investors, reached a separate deal with solar companies that would, essentially, result in the utility giant purchasing more solar power.

The decision by Cooper and senior staff to use the pipeline permit as leverage to force Duke into cutting a deal with the state’s solar industry is documented in text messages, emails and memos included in a 19,216-page document dump released by the administration days before Christmas.

WBTV has reviewed each page of the document dump and conducted additional keyword searched through a searchable version of the massive document file uploaded by WRAL.

The Atlantic Coast Pipeline is a project being developed primarily by Dominion Energy and Duke Energy that would bring natural gas from West Virginia, through Virginia and into southeastern North Carolina.

In the Tar Heel State, the pipeline would run through eastern North Carolina—roughly parallel to I-95— and would terminate in Robeson County.

Cooper’s administration approved a key water permit for the pipeline on January 25, 2018. At the same time, Cooper’s office announced it had signed a separate memorandum of understanding with the ACP that called for the company to pay $57.8 million into a fund to assist with economic development in eastern North Carolina.

At the time Cooper’s office was negotiating the terms of the MOU, Duke Energy was negotiating a separate agreement with solar companies in the state over the terms by which is would connect to and purchase power generated by solar farms across the state.

The disagreement between Duke and the solar industry came in the wake of the enactment of legislation in summer 2017 that was intended to increase the production and consumption of solar power in the state.

But, in the wake of that legislation, Duke and solar companies were at a standstill over a technical rating that would, effectively, determine how much power the utility would purchase.

Documents produced as part of the December dump from Cooper’s office show Cooper and his senior staff were tracking the progress of the negotiations between Duke and the solar companies as they considered whether and when to sign the pipeline MOU.

‘Where are the solar boys on their deal?’

Cooper and his senior staff have said repeatedly that the decision to sign the pipeline MOU had nothing to do with the negotiations between Duke Energy and the solar industry.

Cooper reiterated as much when asked last week by a WBTV reporter about the relationship between the pipeline MOU and the solar negotiations with Duke.

“All completely separate issues,” Cooper said. “This issue regarding the disagreement with the renewable industry and the utilities is one that was going on before that issue with the permit and is still going on today.”

But text messages and documents released by the Governor’s Office in December show otherwise.

A memo drafted by staff at the North Carolina Department of Environmental Quality that was later forwarded to Cooper’s Chief of Staff, Kristi Jones, on November 28, 2017 outlined “ACP mitigation options.”

Among the list of options is increasing the amount of solar energy purchased by Duke.

“Duke to revisit the use of higher capacity transformers to allow for more renewable energy projects to access the grid,” the memo read.

A text message from Cooper’s General Counsel, Will McKinney, to two members of his staff on January 1, 2018, shows the pipeline MOU was scheduled to be signed the following day, on January 2, 2018.

But early on the morning of January 2, 2018, McKinney and Cooper’s Senior Adviser, Ken Eudy, exchanged texts regarding the status of the solar negotiations and whether Cooper should sign the pipeline MOU.

“Not sure we should sign ACP agreement unless solar deal works,” Eudy texted McKinney at 7:18 a.m. on January 2.

“Ok. Don’t disagree,” McKinney responded in part.

Ultimately, the pipeline MOU would be signed on January 25 and announced the following day.

The new agreement between Duke Energy and the solar companies was announced the following Monday, January 29.

Cooper’s Press Secretary, Ford Porter, disputed the notion that the Governor’s Office delayed signing the MOU until an agreement was reached between Duke and the solar companies.

When a WBTV reporter referenced the text between Eudy and McKinney that contemplates delaying signing the MOU until an solar agreement is reached, Porter said that was about message.

“It’s about signing the MOU until the other thing is done,” Porter said “Ultimately, that was unable to occur.”

Porter continued to insist to a reporter that the timing of the pipeline MOU was, ultimately, not linked to a deal being reached between Duke and the solar companies because, he said, the two were announced in different days; a position he maintained when a reporter pointed out the MOU was announced on a Thursday and the Duke solar agreement was announced the following Monday.

DEQ permit delayed, withheld while Governor’s Office debated whether to sign pipeline MOU

Records included in the December document dump and publicly available elsewhere from the North Carolina Department of Environmental Quality show the critical pipeline permit was in limbo while Cooper’s staff debated whether and when to sign the pipeline MOU.

The first deadline for the critical water permit for the ACP to be issued or denied by DEQ was September 18, 2017.

A policy adviser in Cooper’s office reached out in mid-August to two senior DEQ staffers to inquire about the timeline of when the agency anticipated taking action on the permit.

That email request was met with a phone call and a response outlining the timeline in which the agency anticipated handling the permit. The timeline noted the September 18, 2017 deadline.

“We anticipate sending a letter requesting additional information based on comments received during the public notice period before the end of next week,” the DEQ staffer said. “The deadline for a decision would be 60 days from the date that we receive the additional information from the applicant.”

That same policy staffer in Cooper’s office had a calendar entry on August 28, 2017 entitled “ACP deadlines.”

The entry does not list any additional information beyond a date and entry title.

Weeks later, on September 14, a meeting was held between senior staff in the Governor’s Office and DEQ leadership to discuss the ACP.

Eudy, Cooper’s Deputy Chief of Staff, Julia White and Jenni Owen, who was then Cooper’s Policy Director met with senior DEQ leadership, including Secretary Michael Regan.

That same day, on September 14, DEQ issued a request for additional information, which delayed the decision on the water permit.

DEQ issued another request for additional information in late November, which further delayed the deadline for the agency taking action on the permit.

Flash forward to early January, when the Governor’s senior staffers handling ACP issues had agreed to hold off signing the pipeline MOU until the solar companies reached a deal with Duke Energy for the company to purchase more solar power.

In the same time, Cooper’s Chief of Staff, Kristi Jones, was messages with a senior executive at Duke Energy, who is only identified as Lloyd in the document produced in the December document dump. Lloyd Yates is President of the Carolinas Region for Duke Energy.

The text conversation between Jones and the person identified in the documents as Lloyd includes questions as to why the ACP permit had not yet been approved and specifically referred to conversations the company had had on that topic with Cooper’s Senior Policy Adviser, Ken Eudy.

“Here is the issue: Why does it seem that approval of the Atlantic Coast Pipeline is Dragging. How can we move it along. We have had a number of discussions with Eudy and slow progress s (sic),” Lloyd wrote.

Jones did not directly answer the question.

“I think they can discuss,” she responded, referring to a conversation the two were planning between Cooper and Duke CEO Lynn Good for the following day.

There are not any documents in the thousands of pages produced by the Governor’s Office that show what Cooper and Good discussed.

But as Cooper and his staff continued to wait for an outcome of the discussion between the solar companies and Duke Energy, staff at DEQ drafted two letters regarding the ACP water permit: one approving the permit and one denying the permit.

The permit file available on DEQ’s website shows the two draft letters were created on January 22, 2018, just days before the Governor issued the order to sign the MOU, which was signed on January 25, 2018.

DEQ officially approved the pipeline permit the following day, on January 26.

Porter, the spokesman for Cooper, denied the pipeline MOU and pipeline permit were linked beyond staff wanting to announce the two things at the same time.

Porter reiterated his position after this article was initially published early Monday evening. But he did not respond to specific facts raised by a WBTV reporter that suggest staff at the Governor’s Office were, in fact, discussing the pipeline permit with DEQ staff.

Porter also refused to respond to multiple new requests from WBTV to schedule an on-camera interview so Cooper could answer questions related to his office’s handling of the ACP permit and related questions. The renewed refusal to discuss such an interview comes after Cooper’s press staff didn’t answer a request for an interview about the Governor’s handling of the ACP sent late last Monday night.

‘A call to Duke leadership?’

Included in the more than 19,000 pages released by Cooper’s office just days before Christmas are hundreds of emails from North Carolina residents opposed to the pipeline.

Some praised Cooper for delaying a decision on the pipeline in 2017. Other urged him to not issue the permit as the calendar inched closer to January 2018.

Almost all of the emails received by the Governor’s Office were logged into a system that tracked constituent calls to the office or passed along to a policy staffer responsible for energy policy.

But the documents show one email made it to Cooper.

Markus Wilhelm, who is CEO of a solar company called Strata Solar, sent Cooper an email regarding the solar industry’s then-ongoing dispute with the utility company.

Wilhelm highlighted more than a year of disagreements between the solar companies and Duke and asked the Governor for help.

“Any guidance and support (a call to Duke leadership?) you can provide to our industry in this matter is very much appreciated,” Wilhelm wrote.

That email was included in a briefing packet prepared by a policy staffer and passed to Cooper’s senior staff ahead of a call between Cooper and Wilhelm.

Other emails included in the late-December document dump show Eudy, Cooper’s Senior Adviser, checked in to make sure a call between Cooper and Wilhelm had been re-scheduled after it had to be previously cancelled.

Property records and Cooper’s ethics disclosure forms show Cooper and Wilhelm once had a business relationship.

Wilhelm’s company, Strata Solar, leased property from a company that Cooper co-owned with his brother, Pell Cooper, until 2014, when he sold his stake.

WBTV has confirmed Wilhelm was one of two solar company CEO’s to speak with Cooper personally to ask for help putting pressure on Duke regarding the industry’s ongoing negotiations.

A third executive told WBTV he had one conversation directly with Cooper regarding the issue. Text messages included in the document dump show that same executive communicated frequently with Eudy.

Reached by phone for this story, Wilhelm denied having had any one-on-one contact with Cooper.

“I don’t know where you get your information from,” Wilhelm told a reporter when asked about his personal contact with the Governor. “All discussions that ever took place were not one side against the other.”

When a reporter referred to the email Wilhelm sent Cooper, which was included in a briefing packet prepared by staff in late August 2017, Wilhelm again denied making any request for help.

“We didn’t ask the governor to intervene. We discussed the issue with him,” Wilhelm said.

“I don’t even remember anymore,” the CEO told a WBTV reporter when pressed further. “I don’t want to comment on this any further.”

When asked during a press conference specifically about his communication with Wilhelm, Cooper denied singling out any specific group for discussions during the negotiations between the solar industry and Duke.

“I spoke to a lot of renewable energy leaders, I spoke to legislators, I spoke to utility companies because, guess what, I’m in favor of renewable energy. I want more of it for North Carolina,” Cooper said. “We’ve got to get more of it on grid. Our utilities have been hesitant about putting renewable energy on grid. And I want to make sure North Carolina has more of it.”

This story has been updated to include additional information regarding the status of the DEQ-issued pipeline permit during the Governor’s Office deliberations over whether and when to sign the pipeline MOU.

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