Postponed 2019 rate adjustment sees Duke Energy subsidiary gain rate hike
While the final rate increases haven’t been finalized, a delayed request from Duke Energy regarding the rates of its electric subsidiary Duke Energy Progress and how it will pay to get rid of coal ash storage has gained the approval of the North Carolina Utilities Commission (NCUC).
This was despite opposition from almost all public witnesses in the case, according to the NCUC.
Duke had requested a 12.3 percent rate increase, or approximately $463 million, in October 2019. While the COVID-19 pandemic delayed that decision, the company instituted a temporary rate increase in the meantime. The NCUC noted that the new rates, when finalized, will be somewhat higher than even the temporary rates.
“We are pleased with the NCUC’s approval of the settlement agreements between Duke Energy and more than 10 diverse customer and environmental groups as a part of this transparent and thorough process,” Duke Energy said in a statement. “The result is a decision that balances the needs of customers and the company.”
Among other things, the order approved the settlement between the state Attorney General, North Carolina Public Staff, and the Sierra Club that reduced the amount of coal ash management costs recovered in customer rates. Duke Energy is currently working to close all 31 of its North Carolina coal ash pits. The settlement would shift approximately $1.1 billion in expenses over the next decade to Duke Energy and its shareholders to cover that.
Another approved settlement between Duke Energy and 10 stakeholders will benefit future grid improvements to improve reliability and bolster renewable energy in the state, although costs have yet to be evaluated. Further, all storm costs caused by hurricanes Florence, Michael, and Dorian, as well as winter storm Diego were ruled reasonable, allowing Duke Energy to seek securitization of those costs to grant customers savings.
While rates will go up, customers also stand to benefit from a few major requirements. For one, the NCUC eliminated direct debit and credit card bill-paying fees for residential customers and will adopt a Duke Energy proposal to provide broad stakeholder workshops to evaluate rate design and new regulatory programs for low-income customers. Duke Energy will also contribute $6 million over two years to the Helping Home Fund to provide energy and cost-saving measures, as well as another $5 million to a billing assistance program for low-income customers.
Duke itself noted that it has worked to help customers through the extent of the COVID-19 pandemic and offer a suspension of disconnections, flexible payment arrangements, and pumping more than $20 million into charitable donations.
