Greenville News
CAMPOBELLO, S.C. – When Duke Energy, using a subsidiary, purchased a 199-acre pasture in Campobello in March to build a new substation, it paid a premium.
Duke paid more than $10,000 per acre more for its property than the next closest recent land-only sale in Campobello. Last year, land on Frontage Road sold for $15,000 an acre. Two years ago, another site sold for about $7,500 an acre.
Duke paid $25,000 an acre when it purchased land for $4,963,500 from former Spartanburg County Councilman Frank Nutt on March 30, according to the property deed.
Duke Energy plans to build a new 500-kilovolt substation on the land as part of its $1.1 billion Western Carolinas modernization plan.
Duke set off a firestorm of criticism from residents and business owners in northern Spartanburg and Greenville counties and western North Carolina when it recently revealed plans to erect new high-powered transmission lines to run between its new transmission station to a proposed natural gas plant on Lake Julian near Asheville.
The substation, which Duke said it wants to build in 2016, would be home base for the new project.
Critics have pointed to the high price Duke paid for the land as antithetical to its commitment listed on its project website of minimizing the costs to its customers.
Nutt, a developer and cattle farmer, purchased the largest chunk of the land in 1994 and added several adjoining parcels in 1997, 2007, 2013 and last year.
Nutt said this week he’d purchased the property as an investment and used it mainly for his cattle to graze.
He said he wasn’t looking to sell, but was approached by a real estate agent who wanted to buy it for a client.
“He never would tell me who it was and I, of course, was curious,” Nutt said.
Nutt said he found out Duke Energy was the buyer when the utility released a press statement to announce the project months after he’d sold the land.
“I was willing to sell it but was not looking to sell it,” Nutt said. “I had not listed it and had no immediate plans to sell it.”
A company called TBP Properties LLC bought the land. It was formed in 2006 and is listed by the U.S. Securities and Exchange Commission as one of six South Carolina-based Duke subsidiaries.
“We occasionally use a subsidiary, like many large companies, when we do not want to lose our negotiating position,” said Meghan Musgrave, a Duke spokeswoman.
Asked why Duke paid a premium for the land, Musgrave said the company doesn’t discuss its negotiations.
Duke considered property size, proximity to existing infrastructure, ecological and physical characteristics of the property and overall impact to the community, Musgrave said.
“We feel this site is the best option that meets all of this criteria, and we worked with a property owner that was willing to sell,” she said.
Nutt said though he initially wasn’t planning to sell, he was surprised he was able to negotiate such a high offer.
After he found out who the buyer was, Nutt said he can’t imagine a better use for the property than as a substation.
“There’s no noise. There’s no pollution. There’s no traffic from it. There’s no odor,” he said. “Probably a horse farm or a cattle farm would have more of a nuisance than this would.”
Patrick Knie, an attorney and neighbor to the property who has taken legal action to find out more information about the project, said he found it amazing that Duke would pay $25,000 an acre “because you could buy all the land you want up there for $15,000 an acre.”
Realtors opposed to Duke’s plans also questioned the sales price and showed comparable sites sold for far less.
Duke paid more per acre than every other large (20 acres or more) land-only purchase in the Upstate or Polk County in North Carolina except one in the last five years, according to an analysis of data from the Multiple Listings Service. The one higher price was for 22 acres on Highway 101 near BMW in Greer.
The average price-per-acre of land sales in the last five years was $5,145 per acre.
Nutt turned around and purchased 675 acres from Pacolet Milliken on Rainbow Lake Road in Spartanburg for $2.3 million, or $3,400 per acre in April.
He’s preparing some of that land for pasture now, he said.
Duke will continue to gather comments from stakeholders through mid-August on a proposed route through the mountains for its transmission lines. Then it plans to announce a route by the first of next year, Musgrave said.
Meanwhile, residents are already having their say following a series of three meetings Duke held to show the proposed routes and gather information.
More than a dozen have already left comments with the South Carolina Public Service Commission on a page set up to collect comments as they await Duke’s proposal, said Dukes Scott, director of the Office of Regulatory Staff.
More than 3,000 have signed a Change.org petition to stop Duke’s project.
The transmission lines would allow Duke to import power from Asheville as well as export power from South Carolina so the utility can use the most cost-effective type of generation available, Musgrave said.
It would allow Duke to connect its Duke Energy Progress systems in North Carolina to its Duke Energy Carolinas system in South Carolina, she said.
“All generation that is routed through substations and transmission lines will now be connected to the entire system throughout this region, she said.
Duke plans to complete its transmission lines project by 2019.
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