Duke Energy and the North Carolina Utilities Commission are the middle of negotiations right now to determine how much the power provider can raise rates over the next three years. Stuck in the hours and hours of hearings and testimony, WRAL Investigates received a tip about a two-minute section of testimony that certainly gets your attention.
Duke is asking the commission to raise residential electricity rates by close to 19% over the coming three years, and the utility’s next rate request could be much bigger.
"Given my estimate of the revenue impact of the Company’s MYRP (Multi-Year Rate Plan) and non-MRYP spend over the next three years, current rates will approximately double between now and the end of the company’s next rate case," said utilities engineer Dustin Metz when reading his prior testimony. Metz works for the Utility Commission’s Public Staff, which researches and makes recommendations to the commission.
Just to make sure you read that right: If you’re a Duke power customer, Metz predicts your power bills could double following the next rate negotiations, which will start in 2026.
Metz says he was surprised by his own research about the need for such a massive rate hike.
"It is shocking that maintaining or improving the overall reliability of the company’s entire electric system requires nearly a $9 billion capital project spend by the end of Rate Year three," he said.
WRAL Investigates went to Duke Energy to ask about the ominous prediction.
"Well these are significant transformations we are making to our infrastructure," Duke spokesman Jeff Brooks said.
He says the utility remains focused on the current rate request for the next three years. However, customers will be on the hook to meet growing demand and clean energy requirements in the not-so-distant future.
"We hear from our customers that they want reliable service. We hear that they want a secure grid. And we’re committed to all of that," Brooks said. "And we hear increasingly that they want access to cleaner energy options and for us to reduce our operational footprint. There is a cost to all of that and we do everything we can to manage that cost, but at the end of the day we have to make these improvements."
According to data from the U.S. Energy Information Administration, Duke Energy Progress, which has most of its customers in the eastern part of the state, ranks well in affordability. It’s the 810th most expensive provider in the country out of nearly 1,400 companies tracked by the agency. If rates doubled and other utilities stayed the same, Duke would jump to 26th most expensive.
Duke Carolinas, which covers the western part of the North Carolina, would jump from one of the cheapest — 1,116th least expensive to the 39th highest rates in the U.S.
"It’s not something I’d want to hear if I were a North Carolina consumer. I would want to know what I’m getting for paying that amount," says Jessica Shipley of the Regulatory Assistance Project.
Shipley helps analyze utility regulation. She says North Carolina’s multi-year rate process will provide consumers metrics to judge Duke Energy on their promises. Unlike other parts of the country though, the process lets the utility drive rates through its own predictions.
"By using forecasted costs we’re kind of giving them a blank check," Shipley says.
Following Metz’s testimony, the Energy Director of the Utilities Commission’s Public Staff was asked about the impact of doubling power rates. James McLawhorn said no one would be spared. Cost increases would come for "customers on fixed incomes, customers not on fixed incomes, businesses, industry, everybody, yes."
Brooks understands the sticker shock customers will experience if rates double. He says Duke will try to help, "We know that for some customers any increase is a challenge, and we’re going to do everything we can to manage that as much as possible," he said.
Last year, the two Duke providers in North Carolina made nearly $3 billion in net income, but like all public companies, they also have a duty to shareholders of stock. While the dividend checks go out, North Carolina customers will foot the bill for grid upgrades.
"We have to continue making improvements to keep up with the capabilities that our customers want, but we know that there’s a price for that," explains Brooks.
The Utilities Commission is expected to make a decision on the current rate hike request in the coming weeks. Duke will submit its next request in late 2025 or early 2026 and the hearing process will start again. But at least according to one expert, those hearings will likely get much more attention from everyone who gets power from Duke.
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May 24, 2023 at 03:28AM
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Talk about electric shock: Here's why Duke Energy could double your monthly power bill in the coming years - WRAL News
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