Regulators approve Duke Energy Florida's fuel, capacity and storm restoration costs, easing customer bill impacts

Rhea-AI Summary

Duke Energy Florida's updated fuel and capacity rate request has been approved by the Florida Public Service Commission, leading to a residential bill of $171.83 for 1,000 kWh, reflecting a $6.28 increase, or just under 4%. The new rates, effective April 2023, incorporate a 21-month recovery period for under-recovered fuel costs, reducing the overall bill increase by $27.21 compared to prior estimates. Additionally, the company will pass on approximately $56 million in tax savings from the Inflation Reduction Act to customers, contributing to further relief amidst rising operational costs due to natural gas price fluctuations.

Positive

• Updated fuel and capacity rates reduce residential bill impact by $27.21.
• Tax savings of approximately $56 million from the Inflation Reduction Act benefit customers.
• Implementation of a longer cost recovery period mitigates immediate financial burden.

Negative

• Residential customer bills will still see an increase of $6.28, or nearly 4%.
• Commercial and industrial customers face similar bill increases ranging from 2% to 3.9%.

• Extended cost recovery period and updated 2023 fuel prices reduce residential bill impact by $27.21

ST. PETERSBURG, Fla., March 7, 2023 /PRNewswire/ -- Today, the Florida Public Service Commission (FPSC) approved Duke Energy Florida's updated fuel and capacity rate request and recovery of storm restoration costs.

The monthly bill for a typical residential customer using 1,000 kWh will be $171.83, which is an increase of $6.28, or just under 4%. Most commercial and industrial customers will see bill impacts ranging from a 2% to 3.9% increase.

The new rate will take effect beginning April 2023 and reflects recovery of the fuel under-recovery for a period of 21 months.

This extended recovery period and updated 2023 fuel cost estimates approved by the FPSC reduce the residential bill impact by $27.21, compared to the January filing.

In addition to fuel costs, this rate adjustment also includes storm restoration work, mostly associated with hurricanes Ian and Nicole. The company incurred costs to secure the necessary resources to quickly and safely prepare, respond and restore power.

"We are pleased with the Florida Public Service Commission's rapid review and approval of the updated fuel and capacity rate request. This provides more immediate relief for our customers," said Melissa Seixas, Duke Energy Florida state president. "We encourage families who are facing financial hardships and need assistance to reach out to us."

During 2021 and 2022, a number of unique events drove up natural gas prices and caused supply uncertainty, which affected not only utility companies but a variety of other industries that rely on natural gas as well.

The company uses natural gas as its main fuel source to generate reliable electricity across the state of Florida. The company does not profit from these increased fuel costs and proactively takes measures to insulate customers from volatility.

Creative solutions to cut costs

Duke Energy Florida works hard to provide the best possible price for our customers. These steps include the previous implementation of an innovative rate mitigation plan to spread the recovery of unrecovered fuel costs over a longer period, delivering a diverse fuel mix, including solar for power generation, and managing fuel and generation resources in the most cost-effective manner for our customers.

As a result of the company's continued commitment to solar investments, Duke Energy Florida is already passing approximately $56 million of corporate tax savings annually to customers from the Inflation Reduction Act. For residential customers, this resulted in a decrease of $1.90 per 1,000 kilowatt-hours beginning in January 2023. Additionally, the company is refunding customers another $11.7 million in tax savings from 2022 solar generation.

Duke Energy Florida will continue to look for creative solutions to provide rate relief and focus our efforts to deliver the best possible service for our customers.

Duke Energy Florida

Duke Energy Florida, a subsidiary of Duke Energy, owns 10,500 megawatts of energy capacity, supplying electricity to 1.9 million residential, commercial and industrial customers across a 13,000-square-mile service area in Florida.

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 27,600 people.

Duke Energy is executing an aggressive clean energy transition to achieve its goals of net-zero methane emissions from its natural gas business by 2030 and net-zero carbon emissions from electricity generation by 2050. The company has interim carbon emission targets of at least 50% reduction from electric generation by 2030, 50% for Scope 2 and certain Scope 3 upstream and downstream emissions by 2035, and 80% from electric generation by 2040. 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 2023 "World's Most Admired Companies" list and Forbes' "World'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: Ana Gibbs
Media line: 800.559.3853

 

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SOURCE Duke Energy

FAQ

What is the new residential bill amount for Duke Energy Florida customers?

The new monthly bill for a typical residential customer using 1,000 kWh will be $171.83.

When will the new rates for Duke Energy Florida take effect?

The new rates will take effect beginning April 2023.

How much will the typical residential bill increase for Duke Energy Florida?

The bill will increase by $6.28, or just under 4%.

What are the key components of the new rates approved for Duke Energy Florida?

The new rates include a recovery of fuel under-recovery over 21 months and costs associated with storm restoration.

How much in tax savings is Duke Energy Florida passing to its customers?

Duke Energy Florida is passing on approximately $56 million in tax savings to customers.