Duke Rate Increase History

Duke Rate Increase History

Duke Energy seeks N.C. rate increase

The Business JournalSeptember 21, 2006

Duke Energy Corp. is asking the North Carolina Utilities Commission in Raleigh to allow it to increase utility rates to cover the costs of building a proposed nuclear plant in Cherokee County, S.C.

Approval would mark a major change in the Carolinas, where utilities have been required to put a plant in operation before recovering the expense. That approach, Duke Chief Executive Jim Rogers has said, would put too much strain on Duke, particularly in building a nuclear plant that could take a decade to complete.

Charlotte-based Duke expects to invest $125 million by the end of 2007 toward developing the proposed William States Lee III Nuclear Station in Cherokee County, which will be jointly owned with Southern Co. (NYSE: SO) of Atlanta.

The company is scheduled to make a decision on building the plant, projected to cost $4 billion to $6 billion, by the end of 2010.

The plant could begin electricity production in 2016.

"The intent of this request is to ensure that we can continue to fund the development and permitting of a new nuclear power plant, which will help maintain our competitive rates, grow our economy and help minimize overall greenhouse gas emissions as we continue to work to address climate change," says Ellen Ruff, president of Duke Energy Carolinas. "As the application notes, we intend to work with the commission to seek a legislative remedy if the commission concludes it does not have the statutory authority to grant our request."

Duke (NYSE: DUK) is a diversified energy company with a portfolio of natural gas and electric businesses, both regulated and unregulated.

Duke Energy Carolinas Asks for 12.6% Rate Increase in North Carolina

June 2, 2009 -- CHARLOTTE, N.C. -- Duke Energy Carolinas has filed a request with the North Carolina Utilities Commission to increase its North Carolina customer rates by approximately 12.6 percent.

If approved, the general rate changes are expected to be implemented no earlier than Jan. 1, 2010.

“Customers count on us to provide power that is affordable, reliable and clean. This rate increase helps ensure that we deliver on that commitment today and in the future,” said Brett Carter, president of Duke Energy Carolinas. “We recognize that this is a challenging time to ask customers to pay more for electricity, so we didn’t make this decision lightly.”

If approved by regulators, the increase to bills will vary depending on the type of customer. The average North Carolina residential bill -- for 1,000 kilowatt-hours of electricity -- would increase approximately 13.53 percent, or $11 a month. General service rates (non-residential and non-industrial customers) would increase by approximately 9.78 percent, industrial customers’ bills would go up approximately 15.25 percent and outdoor lighting rates would increase by approximately 16.74 percent.

If the rate increase is approved, annual revenues from North Carolina retail operations would increase by approximately $496 million. Adjusting base rates allows the company to realign its expenses with the price it charges customers. Since 2006 through the end of September 2009, Duke Energy Carolinas will have invested approximately $4.8 billion for pollution control equipment on some of its largest plants, new power lines and equipment across the system, and new plant construction.

Although the company adjusts fuel costs on an annual basis, the last general rate increase in North Carolina was in 1991. In fact, rates were actually lowered in recent years. In 2006, there was a one-time annual rate reduction of $117 million in shared savings achieved through the merger with Cinergy. More recently, rates were lowered by $287 million, or 7.5 percent, as part of a rate review required by regulators in 2007.

Duke Energy’s North Carolina rates are currently 31 percent below the national average and about 24 percent below other utilities in the Southeast. Even with the requested increase, Duke Energy Carolinas’ rates will remain well below those averages.

Company Cutting Costs
Duke Energy is committed to meeting its customers’ electricity needs as efficiently as possible. In 2009, the company set a cost reduction target of $100 million across the organization and froze wages for most salaried personnel. During these challenging economic times, the company has also pared back its capital spending.

“The operational efficiencies we’ve achieved and the strict cost controls we have implemented at the company have not been enough to offset the need for an increase given our significant capital investment in pollution control equipment, new generation, and transmission and distribution,” said Carter.

Money-saving Opportunities for Customers

On June 1, Duke Energy launched a number of energy efficiency programs to help customers in the Carolinas save power and money. In North Carolina, the average residential customer can save about $5 a month by participating in energy conservation programs.

From programs to help qualified customers improve energy efficiency in their homes, to cash incentives for purchasing energy-efficient equipment, these programs are first steps in helping residents and businesses lower their energy bills. Other programs will enable customers to save even more by allowing the utility to manage their energy use in times of high demand. More information is available at

Duke Energy Carolinas Reaches Proposed Settlement in Its Request to Raise Base Rates in North Carolina Oct. 20, 2009

CHARLOTTE, N.C. -

Duke Energy Carolinas earlier today filed an agreement with the North Carolina Public Staff in the company’s request to raise base rates for the first time since 1991.

The proposal must be reviewed and approved by the North Carolina Utilities Commission in a hearing scheduled for tomorrow. Changes to rates associated with this proposal are expected to be implemented on Jan. 1, 2010.

“We believe this agreement is a reasonable compromise that benefits our customers and the company. It strikes a balance between today’s unique economic challenges and the need to ensure a reliable, affordable and clean energy supply for the future,” said Jim Turner, Duke Energy’s group executive, president and chief operating officer of U.S. Franchised Electric and Gas. “Our objectives in this case were clear – to be sensitive to our customers, to better align our rates with expenses and to maintain a strong financial position as we continue to modernize the system. We appreciate the willingness of the Public Staff to negotiate a fair agreement that balances the needs of communities, customers and the company.”

Under the terms of the agreement, a base rate increase of $315 million (or 8 percent) will be phased in over two years. However, additional steps outlined in the proposal help lower the total impact to customer bills to an increase of approximately 7 percent in the near term. The bottom line average increase to customer bills in 2010 would be 3.8 percent and an additional 3.2 percent in 2011.

Additional highlights of the proposed settlement include:

10.7 percent Return on Equity and a capital structure of 52.5 percent equity and 47.5 percent long-term debt.
Three riders relating to fuel costs, fuel inventory, and insurance costs, when netted against the base rate increase proposed in the settlement, would reduce the total impact to customer bills to 7 percent over two years.
The company will begin collecting financing costs related to the Cliffside modernization project beginning Jan. 1, 2011.
An agreement not to file another rate case before 2011 with any changes to rates taking effect no earlier than 2012.

“When I speak with our customers, they are quick to applaud our company for offering a reliable product at highly competitive rates. They also recognize that we’ve invested nearly $5 billion since 2006 to deliver that level of service,” said Brett Carter, president of Duke Energy Carolinas. “Even with this proposed increase, our rates will remain far below the national and regional averages. We know price matters to our customers and to companies that may choose to move to North Carolina.”

Money-Saving Opportunities for Customers
On June 1, Duke Energy launched a number of energy efficiency programs to help customers in the Carolinas save power and money. In North Carolina, the average residential customer can save about $5 a month by participating in energy conservation programs.

Duke Energy Carolinas
Duke Energy Carolinas owns nuclear, coal-fired, natural gas and hydroelectric generation. That diverse fuel mix provides approximately 19,000 megawatts of electricity capacity to approximately 2.4 million customers in a 22,000-square-mile service area of North Carolina and South Carolina.

Headquartered in Charlotte, N.C., Duke Energy is a Fortune 500 company traded on the New York Stock Exchange under the symbol DUK. More information about the company is available on the Internet at:

NC utilities panel agrees to Duke Energy increase

By GARY D. ROBERTSON - Associated Press Writer - Associated Press

December 08, 2009

North Carolina regulators have signed off on a plan in which Duke Energy Corp.'s 1.8 million electric customers in the state will see their bills go up next month and rise 7 percent on average over the next two years — nearly half the increase originally sought by the utility.

The North Carolina Utilities Commission approved a two-step agreement to let Duke Energy raise rates Jan. 1 by an average 3.8 percent, followed by a 3.2 percent increase in January 2011, according to the utility.

Residential customers on average would pay a little more — 7.5 to 8 percent over two years. Other customers will see increases from 4.8 to 7.4 percent, Duke said.

The deal, reached with the commission staff's consumer representatives in October and approved Monday by the full commission, allows Duke Energy to generate an additional $315 million annually through its first general rate increase since 1991. Duke said it needed the increase to keep up with inflation while investing in its electric infrastructure.

"We are pleased that the (commission) recognized how this settlement balances the challenging economic climate with the need for Duke Energy to raise its base rates," Jim Turner, Duke Energy's president and chief operating officer for its U.S. franchised electric and gas business, said in a Tuesday release.

Duke Energy Carolinas — the company's electric subsidiary in North Carolina — had initially sought an overall average rate increase of 12.6 percent. The commission's Public Staff balked and suggested a 4.7 percent increase was appropriate — leading to the compromise.

The average residential customer using 1,000 kilowatt hours per month will pay $7.30 more per month by 2011, or a bill of $97.50, according to Robert Gruber, executive director of the commission's Public Staff.

One of the commission's seven members — Robert Owens Jr. of Manteo — opposed the compromise because he said it would place an "unjustified burden" on customers during a period of economic uncertainty and 11 percent state unemployment.

"Simply put, this is the worst possible time to raise electricity rates on Duke's customers and put a further drag on the North Carolina economy," Owens wrote, adding $183 million was the maximum rate increase that should have been approved.

The company made concessions to soften what would otherwise be an 8 percent general rate increase on customers, such as deferring by one year its plans to collect financing costs to build a new coal-fired generator in western North Carolina.

"We're doing everything we can to keep our rates low for our customers," Duke spokeswoman Paige Sheehan said.

Customer bills would be poised to go up by another 1 percent on average in 2012 after other fuel cost returns and nuclear insurance dividend distributions end. But it's unclear right now if rates will adjust otherwise, Sheehan said.

Duke's N.C. rates going up 8%

Posted 16 December 2009 - 07:11 PM

Duke Energy won approval Tuesday for its first N.C. rate increase since 1991, stirring outrage over raising power bills in the depths of a recession and anger over Duke's growing investment in coal power.
The N.C. Utilities Commission approved a compromise settlement that gave Duke an overall 8 percent rate hike over two years, pared down from the 12.6 percent increase in 2010 Duke first sought.
Typical residential customers will pay $3.70 a month more in 2010 and $3.61 more in 2011, totaling 7.5 percent. Rates rose 4.8 percent in September to account for rising fuel costs.
Even with a smaller increase - Duke had initially asked for a 13.5 percent residential hike - one commissioner dissented, citing an "unjustified burden" on Duke's 1.8 million N.C. customers.

Duke Energy seeks permission to increase rates for customers in Carolinas

By Nikie Mayo

Friday, June 24, 2011

ANDERSON — Duke Energy is seeking permission to increase the base rates charged to its customers in the Carolinas in early 2012, company officials said Friday.

Based in Charlotte, N.C., the power company serves about 4 million customers in five states, and more than half of them are in the Carolinas.

Chuck Claunch, Duke Energy’s regional director of state government affairs in South Carolina, said it is too early to know how much the base rates for power could go up, though he expects to have firm numbers by August.

Claunch, whose office is in Columbia, S.C., was in the Upstate on Friday to tell AndersonCounty’s state legislative delegation about the planned increase. Claunch said the increase is intended to offset the cost of $4.8 billion in infrastructure upgrades that Duke Energy has undertaken in the last two years, including work on natural-gas plants in North Carolina that will benefit customers in South Carolina.

The company will request permission from the Public Service Commission of South Carolina to increase its base rates, Claunch said, and a series of public hearings will follow.

“I like to say that we keep our receipts in a shoebox and then ask for recovery,” Claunch said. “The Public Service Commission determines what can be recovered and there is a lot of opportunity for public input.”

Company spokesmen Jason Walls and Betsy Conway said that Duke Energy is also seeking permission from the N.C. Utilities Commission to increase customers’ base rates in North Carolina. Duke Energy serves 2.4 million customers in the Carolinas. The company has different rate structures in each state, Walls said, but said it is too early to know how much the base rates of North Carolina customers could go up.

Claunch said he expects Duke Energy’s increase in base rates will take effect next January or February.

The Public Service Commission of South Carolina approved a 5.2 percent general rate increase for Duke Energy that took effect in February 2010.

Similarly, the N.C. Utilities Commission approved a phased-in 8 percent increase for customers in that state, with a portion of the increase taking effect in January 2010 and the rest of it effective in January of this year

Before those increases were approved, Duke Energy’s base rates in the Carolinas had not gone up since 1991. Base rates for power are separate from fuel rates, which are adjusted annually.

Duke Energy seeks 15 percent N.C. rate hike

It's the company's largest request for an increase in N.C. in 20 years. Residential rates would go up 17 percent.

By Bruce Henderson

Jul. 02, 2011

Duke Energy filed Friday for an overall 15 percent rate hike, its largest such request in North Carolina in at least 20 years.

It's the second of three increases Duke plans to seek as it rebuilds its aging fleet of power plants. Duke also gave notice Friday that it will soon file a rate case in South Carolina.

Consumer advocates and customer groups attuned to the state's soft economy will try to pare down Duke's request. A hearing before the N.C. Utilities Commission is expected in Raleigh in late November.

Duke serves 1.8 million N.C. customers, most of them in the state's western half.

N.C. residential rates would go up 17 percent, adding $19 to the average $97 monthly bill. Commercial and industrial rates would rise 14 percent.

"It's huge. It's a lot larger than any request that we've seen in a while," said Ralph McDonald, a Raleigh attorney who represents industries.

Three-fourths of the $646 million in new revenue a year would be used to cover Duke's $4.8 billion in building costs since 2009. Duke plans to retire 38 old coal- and gas-fired generating units by 2015 as environmental standards toughen.

Projects underway include construction of a new natural gas-fired plant, replacement of a hydroelectric plant, installation of an air-pollution scrubber at Duke's Cliffside coal-fired power plant and construction of a new unit there.

"We tried to be as transparent as we could be about what we would be filing" to recover those costs, said Duke's N.C. president, Brett Carter. "Those plants are going to benefit customers in a big way."

But a rate hike won't be easy for customers such as Charlotte resident Susan Spaulding, who lost her job nearly a year ago. Despite her best efforts, from installing a ceiling fan to cleaning her refrigerator's coils, Spaulding said electricity costs leave her vulnerable.