Biz Blog

Choose a blog

Duke Energy agrees to cut rate hike from 15.2 percent to 7.2 percent

Bookmark and Share

Duke Energy and the state's consumer advocate have agreed to cut Duke's rate request by more than half just days before public hearings are set to begin in Raleigh on Monday.

Charlotte-based Duke, the state's biggest electric utility, and the Public Staff have agreed to cut the rate increase to 7.2 percent, which would add about $7 to a typical monthly residential bill of $97 a month.

The last-minute settlement aligns Duke and the Public Staff in a contentious case that has generated 1,100 protest letters from customers in the past two months alone. A number of towns and county governments have urged the N.C. Utilities Commission, which will decide the case, to consider the plight of state residents in the midst of one of the worst economic downturns in the past century.

The state's Attorney General, meanwhile, has vowed to continue fighting Duke's rate request. The Attorney General, who also represents state residents in public utility rate matters, has in the past taken a harder line than the Public Staff.

“A 7.2 percent rate increase is too much for working families and businesses during these tough economic times," according to a statement from the agency. "At the hearing, our attorneys will ask tough questions and urge the Utilities Commission to consider the impact on consumers.”

Dozens of industrial and commercial customers -- giant consumers of electricity that can pay tens of thousands of dollars a month in utility bills -- will also have to decide if they want to join the settlement with the Public Staff or continue fighting the rate request.

The matter is set for a public hearing Monday before the N.C. Utilities Commission, the state body that could accept the settleement or come up with its own determination as to what rate increase, if any, is justifiable.

Duke has 1.8 million customers in North Carolina, including about 170,000 in Durham, Chapel Hill and other areas on the western side of the Triangle.

The Public Staff had originally said it would tolerate a rate increase of only 4.8 percent. But Public Staff Director Robert Gruber said a settlement means that both sides give a little and meet somewhere in the middle.

"We reached a compromise," Gruber said.

Duke had originally requested an overall increase of 15.2 percent, but the residential component of the rate increase would have been 17.4 percent, or about $18 a month extra on a typical household bill.

Duke has argued it needed the full rate increase to cover nearly $5 billion of construction costs incurred in recent years. The company has said it plans to file for another rate increase next year as well. And Duke was granted a 7 percent rate hike in 2009.

Comments

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.

Compromise?!

Why do we even have a "Public Staff" if they do this sort of fake compromise crap?

Next time Duke will just ask for a 30% increase so they can get their "compromise" of 15%.

Make Duke prove their case for ANY increase to residential customers, then bring industrial customers up to the residential rate (yes, industry pays Duke less than real people) before allowing ANY residential increase.

Cars View All
Find a Car
Go
Jobs View All
Find a Job
Go
Homes View All
Find a Home
Go

Want to post a comment?

In order to join the conversation, you must be a member of newsobserver.com. Click here to register or to log in.

About the blogger

John Murawski has been a full-time newspaper reporter since 1991, with stints at Legal Times and The Chronicle of Philanthropy (both in Washington, DC), The Philadelphia Inquirer and The Palm Beach Post (in South Florida) before arriving at the N&O in December 2004. At the N&O he covers energy (nuclear, coal, renewable, efficiency), hydraulic fracturing (or "fracking"), public utilities and health care. His beat includes PSNC Energy, Piedmont Natural Gas, Duke Energy Progress, PowerSecure International, GlaxoSmithKline, Merck, Novo Nordisk, Pfizer, Biogen Idec and others. He has also contributed more than 30 book reviews on topics spanning botany, history, science and religion. You can reach him at 919-829-8932 or e-mail him.
Advertisements