Progress Energy's North Carolina customers could be in for a slight rate reduction this year, thanks to the falling price of the fuels Progress uses for its power plants.
The Raleigh-based company told South Carolina regulators today it plans to cut rates in that state to account for falling fuel costs, largely attributable to record-low costs of natural gas. The change would reduce a typical residential bill by about $3.50 a month for that state's 175,000 customers.
Progress is expected to make a similar request in this state next month. While the cost factors from state to state are not identical, the South Carolina filing indicates that residential and business customers in this state would see a potential decrease as well.
The typical residential monthly bill is $106 in this state for Progress customers, based on 1,000 kilowatt hours of monthly usage. The company has 1.3 million customers in North Carolina.
N.C. Utilities Commission is widely expected to approve the request, which would be effective Dec. 1. Progress and other electric utilities are permitted to pass on their fuel costs to customers, but state law requires them to negotiate the best possible deals for their customers.
However, the benefits of the fuel adjustment would be short-lived. Progress is expected to file for a major rate increase toward the end of this year, to be effective in 2013. It would be the first general rate increase request since the company last filed in 1987 as Carolina Power & Light.
Commission approval is anything but assured for a general rate request. The request will require voluminous filings and lengthy hearings, and, potentially, a compromise settlement between the company and state consumer advocates that would reduce the amount of the request.