Duke Energy wants to increase electric rates for South Carolina customers, beginning next year.
Duke Energy Carolinas notified the South Carolina Public Service Commission in October, but filed the official application Nov. 8. The company lists completed and planned projects to modernize power plants, generate cleaner energy and otherwise enhance service as reasons for the change.
“Customers want safe, reliable and increasingly clean electricity,” said Kodwo Ghartey-Tagoe, Duke Energy’s South Carolina president. “They also want more options and control over how they use energy in their everyday lives. We’re working hard to build a smart, secure and flexible electric infrastructure to better serve our customers and keep South Carolina competitive now and in the years ahead.”
Duke Energy Carolinas serves about 591,000 upstate South Carolina customers, including many in York, Lancaster and Chester counties.
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Duke Energy Progress is a separate entity, serving about 169,000 customers in the Darlington, Florence and Sumter areas. Duke Energy Carolinas and Duke Energy Progress filed separate rate increase requests.
The Duke Energy Carolinas increase would raise revenue for the company by $168 million. It’s a 10 percent increase.
Residential customers would see an average increase of 12.1 percent, while businesses would see an average 8.3 percent bump.
A resident using 1,000 kilowatt hours of electricity each month would pay $129.43 for each of those months, up $15.57 from current rates.
Duke is asking for the new rates to begin June 1, 2019.
The rate change process involves public hearings. Dates haven’t been set yet, but will be listed online when they are.
Customers can get information on and file letters for or against the increase at the public service commission website at psc.sc.gov.
Duke Energy Carolinas covers 24,000 square miles in western South Carolina and central/western North Carolina. It includes 62 counties, 18 of them in South Carolina. Duke Energy Carolinas has about 2.4 million retail customers.
In 2017, the company brought in about $7 billion in revenue. About 24 percent of that total came from South Carolina.
Existing rates came from a 2013 rate case. The new rates will help to upgrade the power system and close coal ash basins, according to the company. They also account for $16 million of grid investments in 2020 and $20 million in 2021. A $46 million net tax benefit for the company as a result of the Federal Tax Cuts and Jobs Act factored into the requested rates, as did $17 million from a reduction in North Carolina state taxes.
Along with the $15.57 per month increase for that typical residential customer beginning next summer, increases of $1.54 and $1.92 per month would follow in 2020 and 20201, respectively.
The base residential charge would increase from $8.29 to $28 per month next year. According to the company, the base rate isn’t an addition to the overall rate increase but instead “a change in the manner in which the company collects its costs,” according to the rate application.
According to the company, Duke has invested about $639 million in new gas-fueled power generation, replacing older, less efficient coal generation with natural gas. Two large solar facilities added in 2016 and 2017 represent a $152 million investment, according to the rate application. Duke states it has a $126 million investment for hydroelectric relicensing on the Catawba-Wateree river basin.
The rate request looks to recover $125 million over the next 12 years from South Carolina customers, related to canceling plans for the Lee Nuclear Plant near Gaffney.
Other costs include environmental compliance and customer service upgrades. The company argues in the rate application that revenue is needed for recent, ongoing and expected costs to provide clean and reliable energy.
“The electric power grid is the backbone of South Carolina’s digital economy – not just today, but for decades to come,” Ghartey-Tagoe said.