North Kentucky News

The City of Covington has initiated legal proceedings against Duke Energy, challenging the company's claim to an exclusive, perpetual right to provide electric service in the city without a franchise agreement. This move follows five years of unsuccessful negotiations and mediation between the two parties.

City officials have clarified that this legal action will not impact customer rates or the availability of electric services. However, they hope a favorable outcome will compel Duke to engage more collaboratively with the city and its residents.

Mayor Joe Meyer expressed frustration over Duke's practices, stating, "This is a classic case of a big institution thinking it can do whatever it wants and that it can ignore established, reasonable, local ordinances." He emphasized that Duke must adhere to business norms like bidding processes and franchise agreements as mandated by state law.

The legal filing took place in Franklin Circuit Court and was also submitted to the Kentucky Public Service Commission (PSC), which oversees utility regulation in the state. The Covington Board of Commissioners had previously authorized this action on October 22.

The dispute focuses solely on electric service provided by Duke Energy and does not involve natural gas services. City Solicitor Frank Schultz explained that the crux of the issue is straightforward: whether Duke holds an exclusive perpetual franchise as claimed from its predecessor, Covington Electric Light Company. The city's complaint references a 1904 U.S. Supreme Court decision authored by Justice Oliver Wendell Holmes Jr., which reportedly nullified such claims.

Covington seeks a court ruling confirming that Duke lacks a perpetual franchise and requests PSC intervention to ensure compliance with local bidding procedures for electric service provision rights.

Mayor Meyer criticized Duke's stance for adversely affecting local businesses and residents. Examples include delays in relocating or insulating power lines during building renovations and failure to inform the city about other companies using public utility poles—actions required by city ordinances but allegedly ignored by Duke.

Frank Schultz underscored the importance of franchise agreements for fostering mutual respect between utilities and municipalities: “Franchise agreements at their core are about establishing a fair, equal, and level playing field.” He argued that without such agreements, companies like Duke lack incentives to address community concerns effectively.