Duke Energy requests 16.7 percent rate hike on residential customers – Greensboro News & Record

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Duke Energy Carolinas LLC filed Friday a request to raise residential customers’ rates by an average 16.7 percent annually to help paying for a 10-year modernization initiative.

The proposed rate hike would affect about 2 million customers from Durham to the west, including the Triad, and amount to $647 million in new annual revenue.

The request was submitted to the N.C. Utilities Commission, which could take seven to nine months to decide on whether to grant a rate increase and by how much. If approved, it would be the first rate increase for that part of the state in five years.

The utility projects a residential customer who uses 1,000 kilowatt-hours of electricity monthly would pay about $122.68, reflecting an increase of $18.72.

The utility also wants to raise its rate by an average 10.9 percent on commercial and industrial customers in that region.

Duke Energy Carolinas separately filed a request for commission approval to halt its Lee nuclear plant project near Gaffney, S.C.

The Charlotte Observer reported the utility wants to be allowed to recoup up to $636 million in Lee project development costs from customers. The recouping would represent $53 million of the $647 million annual revenue increase for a 12-year period.

“Nearly half of the rate request reflects investments in cleaner generation, including hydro, solar and natural gas,” the utility said.

“Duke Energy Carolinas has maintained rates below the national average, and with the proposed change, customers would continue to pay rates lower than in 1991, when adjusted for inflation.”

Duke Energy Progress, which covers the eastern parts of N.C. and portions of the Asheville region, earlier requested a 14.9 percent overall rate increase — including 16.7 percent for residential customers — for 1.3 million customers. That increase is projected to gain Duke Energy Progress an additional $477 million in annual revenue.

“As our state grows, and as we think about the future energy infrastructure required to serve our customers, a smarter grid will facilitate cleaner energy sources and provide customers the tools they need to make more informed energy decisions,” David Fountain, Duke Energy’s North Carolina president, said in a statement.

Fountain said in a Tuesday interview with the Winston-Salem Journal that “we don’t take this (rate increase) lightly and understand its impact on low-income households and small businesses.”

Challenges

Although Duke Energy Carolinas gained on Dec. 27 federal Nuclear Regulatory Commission approval to build the Lee plant and operate two nuclear units, it has chosen to abandon the project, primarily because the nuclear-reactor supplier, Westinghouse, filed for bankruptcy March 29.

Duke Energy Carolinas had estimated the total Lee plant project cost at $12.94 billion. It has spent $542 million in project development costs as of June 30.

Westinghouse’s “publicly stated intent to cease construction of new nuclear units in the U.S. have placed significant uncertainty on the project,” the utility told the commission.

“It is unlikely the company will be able to construct and commence operation of the project before the end of the next decade.

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