Duke Energy Progress moves to increase base rates to build system of the future

“We know how important electric service is for our customers and no one wants to see bills increase,” said Mike Callahan, Duke Energy’s South Carolina state president. “This is particularly true now as rising costs across most sectors of our economy impact consumers and businesses throughout South Carolina and the nation.”

“These challenges affect the energy industry as a whole and – through smart investments – we’re working hard to meet customers’ expectations and build the foundation for a smarter energy future from which all South Carolinians can benefit. These investments in critical energy infrastructure are the main reason for the proposed rate increase,” Callahan said.

“The energy sector is in a period of transformation and profound change driven by technological advancements, environmental and regulatory mandates, unpredictable and extreme weather, energy security and resiliency efforts, as well as changing customer expectations. We are taking steps to anticipate and keep pace with the changes occurring in the Palmetto State to better serve our customers,” said Duke spokesman Ryan Mosier.

The request describes basically three themes of investments:

OPERATIONAL EXCELLENCE/ENHANCING THE CUSTOMER EXPERIENCE

Customers today want more stream-lined options and versatility, driven by information about how they consume energy and by tools that help them manage their consumption.

Duke Energy Progress has taken steps to continuously improve the service our customers receive from, and the interactions they have with, the company since our last base rate increase.

Included in this case is Customer Connect (a new a customer engagement platform including a customer information system, which is a system that manages the billing, accounts receivable, and rates for the company as a central repository for all customer information.

INCREASING RELIABILITY AND RESILENCY

Technology is transforming South Carolina and changing the way customers use electricity and interact with their electric provider. Reliability remains essential as an increasingly connected population continues to expand. Today, the need for consistent, reliable service is not just the expectation of industry and manufacturing but extends into every home and business especially given the pandemic-related shift to hybrid work arrangements and online/home schooling — even at a time when that reliability is challenged by the increasing frequency of severe weather events and the threat of physical and cyber-attack.

Actions the company is taking to increase reliability and resiliency include investments in cleaner, highly efficient generation resources and our continued plans to invest in our distribution grid, smart meters, and the tools it uses to communicate with customers.

Included in this case is the Grid improvement Plan — a multi-year grid improvement strategy to increase reliability and resiliency and enable the sustainable growth of renewable energy and distributed energy resources. These improvements are foundational to achieving the company’s aggressive clean energy and carbon-reduction goals.

Also included in the request are costs to maintain the company’s existing generation fleet and transmission and distribution assets. This includes investments at the Robinson Nuclear Plant to improve efficiency, and flood-mitigation efforts at substations including one in Nichols in Marion County that was affected twice by recent flooding from hurricanes.

ACHIEVING A CLEANER AND SMARTER ENERGY FUTURE

Duke Energy Progress is pursuing an orderly transition towards achieving a clean, secure energy future by taking steps to close the final chapters on its reliance on coal-fired generation and moving toward lower fuel-dependent generation resources.

The voices of customers and investors have become increasingly clear on this topic — they expect the company to invest in cleaner power and are making economic growth decisions based on those expectations.

Included in this request are investments to close coal ash basins in ways that protect the public and the environment, are in compliance with applicable laws and regulations, and minimize impacts to local communities and manage cost. Another significant investment in modernizing the generation fleet was in the highly efficient Asheville Combined Cycle Plant. Replacement of the Asheville steam units with the Asheville combined-cycle units benefits the Duke Energy Progress system as a whole by allowing for the retirement of coal units at the site, avoiding construction of 147 megawatts of fast-start combustion turbine capacity, easing transmission constraints, assisting with compliance with NERC reliability standards, and providing system-wide fuel cost savings and emissions benefits by enabling more efficient dispatch of generation resources.

To ease the effects of these investments on its customers, the company’s rate request before the Public Service Commission of South Carolina (PSCSC) proposes phasing in the proposed rate increases over two years.

If approved by the PSCSC, the total net impact of the proposed increase to residential customer bills is 14.7%. Commercial and industrial customers will see an average increase of around 7.8% (actual rates vary by customer class and size).

If approved, the charge for a typical residential customer using 1,000 kilowatt hours (kWh) of electricity beginning April 1, 2023, will increase $14.36 per month, from $133.01 to $147.37. Starting April 1, 2024, the total monthly impact for a typical residential customer using 1,000 kWh per month would increase an additional $4.40, for an average bill of $151.77 per month.

Customers struggling to pay their energy bills might qualify for assistance from various government and nonprofit programs for utility bills and other household expenses. Duke Energy also offers programs and resources to help customers manage their use to mitigate the impact of rate changes as well as flexible payment arrangements to help customers experiencing uncertainty. These arrangements include flexible payment options including the Share the Light Fund, a Duke Energy program that provides energy assistance.