South Carolina legislation will help Duke Energy Progress customers save money

Innovative legislation will help Duke Energy Progress customers in South Carolina save $35 million in repair costs from a series of historic storms from 2014 through 2022.

Legislation passed in 2022 gives the Public Service Commission of South Carolina (PSCSC) the authority to approve the securitization of storm costs through issuing bonds if a proposed plan submitted by a utility would result in lower overall costs for customers. In 2023, the PSCSC approved the company’s securitization plan.

Thus, Duke Energy Progress completed a $177 million storm recovery bond financing effort in April that will save customers $35 million over the next 20 years.

With a securitization plan, bonds are issued in the financial markets at lower interest rates and the proceeds are used to pay for the extraordinary storm-related expenses, including planning and staging for the storms, the work of line technicians, damage assessors and contractors to the reconstruction, replacement and repair of electric generation, transmission or distribution equipment and facilities.

“Securitization through bond financing is a prudent, proactive, cost-effective response to the significant storm costs that we’ve incurred responding to truly devastating weather impacts in our state over the past decade,” Michael Callahan, Duke Energy’s South Carolina president, said. “We are constantly mindful of customer bills, so we’re very pleased this new cost recovery tool enabled us to significantly reduce the financing costs of storm repair costs for our customers.”

So, residential customers in the region using 1,000 kWh per month will save about 33 percent compared to traditional storm cost recovery approaches, with bills initially increasing approximately $8.38 per month in the first few months and then decreasing to about $5 per month in early 2025. The line item will appear as a “storm recovery charge” beginning in May bills.

Duke Energy Progress serves about 175,000 households and businesses in northeastern South Carolina, including Florence, Sumter, and Darlington counties.