Duke Energy Carolinas Asking for 12.6 Percent 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 http://www.duke-energy.com/north-carolina/savings.asp.
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: http://www.duke-energy.com/.
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