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Duke Energy proposed rate hike

May 26, 2019

FLORENCE, S.C. – Duke Energy has filed proposed rate increases in line with an order of the South Carolina Public Service Commission.

The rate increases, called tariffs in the utility universe, were filed on May 17, nine days after the Public Service Commission granted part of Duke’s requested rate increase for its subsidiary, Duke Energy Progress. On May 8, the commission approved a rate of return on equity of 9.5%, which would provide Duke Energy Progress with over $41 million in additional revenue.

Duke had asked the commission for a 10.5% return on equity that would result in over $69 million for the company.

A portion of the additional revenue, $12.854 million, will be derived from lower tax rates thanks to the Trump tax cuts enacted in 2017.

The rest, $28.618 million, will come from customers.

The rate increases filed by Duke break down the increases by class of customer.

Residential

The residential classification is broken into two subclassifications: Residential and Residential-Time of Use.

The residential basic facilities charge will increase from $9.06 per month to $11.78 per month, an increase of 30%.

Also, the kilowatt-hour charge will increase from 11.637 cents per kilowatt hour to 11.803 cents per kilowatt hour during July-October, an increase of 1.4%.

During November-June, the first 800 kilowatt hours will carry a charge of 11.803 cents per kilowatt hour, a 1.4% increase over the current rate of 11.637 cents per kilowatt-hour. All kilowatt hours after will carry a charge of 11.303 cents per kilowatt hour. The rate of 11.303 cents per kilowatt-hour during November-June increases from 10.404 cents per kilowatt hour, an increase of 8.6%.

Bills for three-phase service include an additional charge of $6.50, up from $6. This is an increase of 8.3 percent.

Duke Energy Progress will increase its revenues in this classification from $238.002 million to $252.912 million, an increase of $14.91 million or 6.26%. Combined with a $265,320 increase, or 6.19%, in residential time-of-use service, Duke will see its revenues increase by $15.176 million, or 6.26%.

Medium General Service

The Medium General Service classification is broken into five subclassifications, including Medium General Service and Small General Service-Time of Use.

The Medium General Service subclassification basic facilities charge will increase from $17.17 per month to $21.35, a 24.4% increase.

Energy charges under this classification will increase 2.56%, from 7.478 cents per kilowatt hour to 7.669 cents per kilowatt hour.

Bills for three-phase service include an additional charge of $6.50, up from $6. This is an increase of 8.3 percent.

The revenues from this classification are expected to increase from $57.163 million to $58.752 million, or 2.78%.

Small General Service Time of Use customers will see their basic facilities charge rise from $23.17 per month to $27.85 per month, an increase of 20.2%.

Also, the classification’s kilowatt-hour demand charge will decrease from $11.55 per all kilowatt of on-peak billing demand to $11.39 during June-September and from $9.02 to $9.49. The charge per kilowatt hour of all off-peak excess demand will increase from $2.95 per kilowatt to $3.24 during all months.

The kilowatt-hour charge will increase from 5.15 cents per off-peak kilowatt hour to 5.423 cents.

The revenues from this classification are expected to increase from $88.258 million to $90.992 million, an increase of $2.734 million or 3.10 percent.

When the Small General Service Time of Use classification is combined with the Medium General Service sub-classification and two other small classifications, overall medium general service revenues are expected increase from $145.605 million to $149.934 million, an increase of 2.97%.

Large General Service

The large general service classification is broken down into three subclassifications, Large General Service, Large General Service-Time of Use and Large General Service Curtailable Schedule.

In the Large General Service subclassification, the basic facilities charge will increase from $98 to $192.

The kilowatt demand charge will increase from $12.80 per kilowatt to $13.34 for the first 5,000 kilowatts of billing demand, $11.80 to 12.34 for the next 5,000 kilowatts, and from $10.80 to 11.34 for the remainder.

The kilowatt-hour charge will increase from 5.392 cents per kilowatt hour to 5.623 cents per kilowatt hour.

In the Large General Service-Time of Use subclassification, the basic facilities charge will increase from $98 to $192.

During on-peak service from June to September, the rate will increase from $19.60 to $20.18 per kilowatt for the first 5,000 kilowatts, from $18.60 to $19.18 for the next 5,000, and from $17.60 to $18.18 for all over 10,000. All off-peak billing demand per kilowatt will decrease from $1.25 per kilowatt to $0.87 per kilowatt.

During on-peak from October-May, the first 5,000 kilowatts will be charged at a rate of $15.01, up from $14.57, per kilowatt, the next 5,000 will be charged at a rate of $14.01, up from $13.57, and all demand over 10,000 kilowatts will be charged at $13.01, up from $12.57. All off-peak billing demand per kilowatt will decrease from $1.25 per kilowatt to $0.87 per kilowatt.

The kilowatt-hour charge on-peak will increase from 5.179 per kilowatt-hour to 5.498 per kilowatt-hour. Off-peak will increase from 4.679 to 4.998 cents per kilowatt hour.

Under the curtailable subclassification, the basic facilities charge will increase to $484.46 from $465.55.

During on-peak service from June to September, the rate will increase from $21.41 to $22.28 per kilowatt for the first 5,000 kilowatts, from $20.32 to $21.15 for the next 5,000, and from $19.22 to $20 for all over 10,000. All off-peak billing demand per kilowatt will increase from $1.64 per kilowatt to $1.71 per kilowatt.

During on-peak from October to May, the first 5,000 kilowatts will be charged at a rate of $16.55, up from $15.90, per kilowatt, the next 5,000 will be charged at a rate of $15.41, up from $14.81, and all demand over 10,000 kilowatts will be charged at $14.27, up from $13.71. All off-peak billing demand per kilowatt will increase from $1.64 per kilowatt to $1.71 per kilowatt.

The kilowatt-hour charge on-peak will increase from 4.767 per kilowatt hour to 4.965 per kilowatt hour. Off-peak will increase from 4.219 to 4.396 cents per kilowatt hour.

The Large General Service rate increases are expected to bring $6.099 million in additional revenue to Duke Energy Progress, an increase of 4.75%.

Small General Service

The Small General Service classification is broken into two subclassifications, one of which is Small General Service.

The basic facilities charge is expected to go from $9.91 per month to $12.34.

The rate per kilowatt hour will increase from 12.157 cents to 12.837 cents for the first 2,000 kilowatt hours and from 8.695 cents to 9.184 cents for all kilowatt hours over 2,000.

Bills for three-phase service include an additional charge of $6.50, up from $6. This is an increase of 8.3 percent.

Combined with another Small General Service sub-classification, Duke Energy Progress is expected to see 7.27% more revenue or $2.434 million.

Other

The classifications previously listed make up the majority of revenue for Duke Energy Progress. However, the company is expected to see an additional 9.3% more revenue from Small General Service-Constant Load, 2.46% more revenue from Seasonal and Intermittent Service, 14.18% more from Traffic-Signal Service, and a decrease of 3.86% for Sports Field Lighting Service.More information on these rate increases is available via the Public Service Commission’s website.

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