Duke Energy Progress submits annual update for fuel, renewable energy, energy efficiency program charges in North Carolina

Rhea-AI Summary

Duke Energy Progress has filed for an annual adjustment of fuel and renewable energy costs with the North Carolina Utilities Commission, seeking to recover increased fuel expenses due to rising demand and commodity prices. If approved, customer bills will increase starting December 1, 2022, with typical residential bills rising by 8.4%, or approximately $10.58. The proposed adjustments factor in a $210 million under-recovery from the previous year. Duke Energy continues to seek ways to minimize fuel costs and has initiated energy-saving programs to benefit customers.

Positive

• Duke Energy continues efforts to minimize fuel costs through active fuel contract management.
• The company is offering energy-saving programs to help customers manage their energy usage.

Negative

• Proposed rate increases include an 8.4% hike for residential customers, raising monthly bills from $126.67 to $137.25.
• The company is addressing a $210 million under-recovery of fuel costs from the previous year.

• Rising demand following COVID-19 shutdown paired with rising fuel costs, which Duke Energy does not profit on, will increase customer prices.
• If approved, customers will see bills increase starting in December.

CHARLOTTE, N.C., June 16, 2022 /PRNewswire/ -- Duke Energy Progress this week made its annual filings with the North Carolina Utilities Commission (NCUC) for costs associated with fuel and various riders, including state programs to encourage renewable energy adoption, and energy efficiency and demand management programs to reduce energy use.

Duke Energy Progress is seeking to recover fuel costs as part of its annual adjustment for the fuel used to power North Carolina homes and businesses. The company does not mark up the cost of fuel and is required by law to pass through the actual cost on a dollar-for-dollar basis to customers.

The NCUC reviews the fuel costs required to serve customers to ensure an accurate adjustment is made each year. If approved, the new fuel and renewable energy adoption rates, along with the Joint Agency Asset Rider (JAAR), would go into effect Dec. 1, 2022, and the new energy efficiency and demand management rates would go into effect Jan. 1, 2023.

By Jan. 1, a typical bill would increase 8.4% for residential customers, 4.6% for commercial customers and 5.6% for industrial customers (residential customer rates would go up 9.0% as of Dec. 1 to adjust for fuel and renewable energy programs and JAAR, then decrease 0.6% on Jan. 1 when energy efficiency and demand management adjustments kick in). The total monthly impact of all rate changes for a typical residential customer using 1,000 kilowatt-hours (kWh) per month would be an increase of $10.58, from $126.67 to $137.25.

What's driving proposed increase

Rising energy demand as North Carolina emerged from the 2020 COVID-19 shutdowns resulted in a significant increase in fuel needs for power generation, compounded by fuel commodity prices climbing drastically in 2021 due to tight supplies.

The sharp increase in commodity prices contributed to a $210 million under-recovery across the prior year, when fuel prices rose after the company's annual filing. The North Carolina fuel clause does not allow utilities to adjust rates during the billing period to prevent customer underpayment, so the proposed rates include recovery of this shortfall.

Duke Energy Progress serves about 1.5 million customers in central and eastern North Carolina and in the Asheville region.

The company's other North Carolina utility – Duke Energy Carolinas – made its annual fuel filing in March. The company recently revised its Duke Energy Carolinas filing to reflect a January 2022 under-recovery on fuel costs; if approved by the NCUC, Duke Energy Carolinas residential rates would rise 9.6% in September to adjust for fuel and renewable energy programs, then decrease 1.3% on Jan. 1 when energy efficiency and demand management adjustments kick in.

Helping customers save

Duke Energy works to actively manage its fuel contracts to keep fuel costs as low as possible for customers. Savings achieved from the joint dispatch of Duke Energy's generation fleet in the Carolinas also help to lower the company's fuel costs.

Duke Energy offers energy-saving tips and innovative efficiency programs for every budget to help customers take control of their energy use. For example, the Home Energy House Call is a free in-home energy assessment that provides customers more information about how they use energy and strategies to save money on their monthly bill. To learn more about these programs, visit duke-energy.com/savings.

Customers struggling to pay their energy bills can seek assistance through the Share the Light Fund, a Duke Energy program that provides assistance to vulnerable customers. Duke Energy is also currently leading a Low Income Affordability Collaborative pursuant to an NCUC order, working with a diverse group of stakeholders to develop new options to ensure equitable, affordable energy for those most in need.

Clean energy transition

In May, Duke Energy filed its proposed Carolinas Carbon Plan with the NCUC – a clean energy plan that targets 70% carbon dioxide (CO₂) emissions reduction by 2030 and carbon neutrality by 2050, while offering regulators multiple options that balance affordability and reliability for customers.

Duke Energy has already retired two-thirds of its coal plants in the Carolinas. With coal projected to get more expensive as supplies dwindle and regulations increase, the company has proposed retiring the rest of its coal fleet by the end of 2035. Those facilities would be replaced by a diverse, "all of the above" mix that includes exponential growth in renewables and storage, as well as energy efficiency programs and other measures to help customers reduce their energy use.

Duke Energy Progress

Duke Energy Progress, a subsidiary of Duke Energy, owns 12,500 megawatts of energy capacity, supplying electricity to 1.7 million residential, commercial and industrial customers across a 29,000-square-mile service area in North Carolina and South Carolina.

Duke Energy (NYSE: DUK), a Fortune 150 company headquartered in Charlotte, N.C., is one of America's largest energy holding companies. Its electric utilities serve 8.2 million customers in North Carolina, South Carolina, Florida, Indiana, Ohio and Kentucky, and collectively own 50,000 megawatts of energy capacity. Its natural gas unit serves 1.6 million customers in North Carolina, South Carolina, Tennessee, Ohio and Kentucky. The company employs 28,000 people.

Duke Energy is executing an aggressive clean energy transition to achieve its goals of net-zero methane emissions from its natural gas business and at least a 50% carbon reduction from electric generation by 2030 and net-zero carbon emissions by 2050. The 2050 net-zero goals also include Scope 2 and certain Scope 3 emissions. In addition, the company is investing in major electric grid enhancements and energy storage, and exploring zero-emission power generation technologies such as hydrogen and advanced nuclear.

Duke Energy was named to Fortune's 2022 "World's Most Admired Companies" list and Forbes' "America's Best Employers" list. More information is available at duke-energy.com. The Duke Energy News Center contains news releases, fact sheets, photos and videos. Duke Energy's illumination features stories about people, innovations, community topics and environmental issues. Follow Duke Energy on Twitter, LinkedIn, Instagram and Facebook.

Media contact: Bill Norton
800.559.3853

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SOURCE Duke Energy

FAQ

What is Duke Energy's planned rate increase for customers in December 2022?

Duke Energy plans to increase residential customer bills by 8.4% starting December 1, 2022.

When will the new rates for Duke Energy go into effect?

If approved, new fuel and renewable energy rates will go into effect on December 1, 2022, with energy efficiency adjustments starting January 1, 2023.

How does Duke Energy address rising fuel costs?

Duke Energy does not profit from fuel costs and passes the actual costs to customers. They are also actively managing fuel contracts to keep costs low.

What is the expected impact on typical residential bills from Duke Energy?

A typical residential bill will see an increase of approximately $10.58, from $126.67 to $137.25.

What factors contribute to Duke Energy's rate increase proposal?

The rate increase is driven by rising energy demand post-COVID-19 and significant increases in fuel commodity prices.