Duke Energy Progress proposes lower overall rates for NC customers

CHARLOTTE, N.C., June 19, 2015 /PRNewswire/ -- Duke Energy Progress' North Carolina customers will see greater savings on their energy costs in 2016 if the company's annual filings receive approval from the North Carolina Utilities Commission (NCUC).

Electric rates would decrease about 3.4 percent for residential customers, 2.6 percent for commercial customers and 1.8 percent for industrial customer bills – putting more money back into customers' pockets.

Multiple factors drive customer savings

On June 17, 2015, Duke Energy Progress made its annual filings with the NCUC for costs associated with fuel, compliance with the state's renewable energy portfolio standard (REPS), implementation of energy efficiency (EE), and demand-side management (DSM) programs.

The total monthly impact of all rate changes (fuel, REPS, DSM, EE) for a typical residential customer using 1,000 kilowatt hours (kWh) per month would be a decrease of $3.32.

If approved, as of Jan. 1, 2016, the charge for a typical residential customer using 1,000 kWh of electricity would decrease from $111.38 to $108.06 per month.

The main reasons for the proposed overall rate decrease involve fuel costs:

• Total fuel costs projected for the upcoming year are declining due to a drop in commodity prices.
• In addition, there's a $50-million decrease in the prior period true-up of fuel costs included in the proposed rate, as compared to the prior period true-up included in the current billing factor.
• Fuel cost savings also are associated with Duke Energy Progress' planned purchase of North Carolina Eastern Municipal Power Agency's ownership share in certain generation assets. The purchase is expected to close later this year.

Duke Energy Progress makes a fuel cost-recovery filing annually in North Carolina. The fuel rate is based on the projected cost of fuel used to provide electric service to the company's customers, plus a true up of the prior year's projection.

The NCUC reviews fuel costs and adjusts the fuel component of customer rates accordingly.

By law, the company makes no profit from the fuel component of rates.

Duke Energy Progress also filed for an increase in the charge to customers for the utility's compliance with the state's renewable energy portfolio standard (REPS).

As filed, the REPS charge would increase $0.34 per month for residential, $0.55 per month for commercial accounts and $36.29 per month for industrial customers.

Proposed increases to the REPS charge reflect increases in actual and projected compliance costs driven by the increase in the utility's overall compliance obligation.

Duke Energy Progress has also filed to recover the costs of implementing programs designed to help reduce energy consumption and save customers money on their energy bills. Rates have increased primarily due to increased customer participation and related costs.

Duke Energy Progress rates also increase by 9 cents per 1,000 kWh on July 1 with the expiration of a N.C. Tax Reform Decremental Rider.

If approved, the new fuel and REPS rates would start Dec. 1, 2015, and the new EE and DSM rates would begin Jan. 1, 2016.

Duke Energy

Duke Energy is the largest electric power holding company in the United States with approximately $121 billion in total assets. Its regulated utility operations serve approximately 7.3 million electric customers located in six states in the Southeast and Midwest.

Its commercial power and international energy business segments own and operate diverse power generation assets in North America and Latin America, including a growing portfolio of renewable energy assets in the United States.

Headquartered in Charlotte, N.C., Duke Energy is a Fortune 250 company traded on the New York Stock Exchange under the symbol DUK. More information about the company is available at duke-energy.com. 

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SOURCE Duke Energy