Duke Energy seeking 6.7 percent rate hike

Duke Energy seeking 6.7 percent rate hike

Duke Energy

Brittney Lofthouse – Contributing Writer

Power bills for residents of Western North Carolina could soon be going up…again. Duke Energy Carolinas announced on Monday they are requesting an average 6.7 percent rate increase for residential customers. 

A homeowner who uses 1,000 kilowatt-hours of electricity per month would pay, under the higher rate, about $116.26 per month – an increase of $8.06 per month, according to Duke Energy Carolinas.

While proposing a 6.7 percent increase for residential customers. Duke Energy also requested an average 5 percent increase for commercial and industrial customers. 

The rate increase request was filed with the North Carolina Utilities Commission on Monday, who will now review the request during a month-long process that allows for public comment. Duke’s request specifically asked for the NCUC to make a decision on the increase no later than August 2020. 

Rate increase requests are common for the company and happen routinely. In 2018, Duke was approved by the commission to increase rates for residential customers in western and central North Carolina by an average of 0.3 percent. The .3 percent was a fraction of the company’s original request, which was 16.7 percent. The commission ultimately rejected the original request. 

The rate hike proposed Monday would bring in an extra $291 million in annual revenue for Duke, the company said. Company officials say the money would cover Duke’s costs related to using cleaner energy and improving reliability. The request states that the increase is needed to pay $36 million for costs the company incurred during Hurricane Florence and Michael as well as Winter Storm Diego. 

In April 2019, Duke Energy was ordered to clean up millions of tons of coal ash from power plants and basins in the state. The company’s most recent request says that $123.6 million would be spent on coming into compliance with environmental regulations such as the coal ash cleanup. 

While the request would increase bills on average $8 a month, the company did say they are looking to eliminate fees associated with paying by debit and credit card in order to offset some of the increase. 

While the request was made to upgrade infrastructure and reduce the environmental impact of Duke, it doesn’t come without benefit to the company’s bottom line. The filing does include a 10.3 percent rate of return on equity for Duke, meaning the company’s overall profit. While 10.3 percent doesn’t seem like a lot, it translates to about a billion dollar increase in Duke’s current rate base.