Duke Energy already asked for one bill increase. Why has it filed for another in NC?
North Carolina residents who saw unusually high electric bills during this winter’s cold snap could soon pay more as Duke Energy seeks to recover the cost of the extra power it had to buy to meet heating demands.
Duke Energy is asking state regulators to approve roughly $800 million in additional charges tied to fuel and power costs from the winter, a move that would raise monthly bills for customers across the state if approved and has already drawn opposition from Gov. Josh Stein amid ongoing backlash over rising utility costs. The request, now before the North Carolina Utilities Commission, would increase residential bills by about $6.90 to $7.88 per month starting as soon as June 1 and lasting for roughly 19 months, according to a news release. The costs would apply to customers served by both Duke Energy Carolinas and Duke Energy Progress.
Duke says the additional charges are needed to recover the cost of supplying power during an extended stretch of extreme cold this winter when demand surged and the company had to purchase electricity from other providers to keep the grid running.
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The proposal also comes on top of a separate pending rate increase request of about 15% that has already drawn heavy criticism from state leaders and customers. If both requests are approved by the utilities commission, households could see higher bills both for the energy they use going forward and to cover previous winter costs.
Stein has called on the North Carolina Utilities Commission, a regulatory agency tasked with overseeing public utilities in the state, to reject the request and prevent additional costs from being passed on to customers.
“The Utilities Commission should step in to secure an affordable energy future for North Carolinians,” Stein said in a statement. “We must do everything we can to make life more affordable for families, not more expensive.”
Why Duke Energy says it needs the money
Duke Energy has pointed to record-breaking demand during the winter cold snap as the primary driver of the additional costs. During that period, the company said it exceeded its own generation and storage capacity and had to rely on electricity purchased from neighboring utilities at elevated market rates to meet demand and avoid outages.
“When customers need power the most – during extreme cold or heat – reliability is not optional,” Kendal Bowman, Duke Energy’s North Carolina president said in a news release. “Our responsibility is to deliver electricity safely and reliably, even when demand exceeds what our system can supply on its own.”
Duke Energy said in a news release this winter’s temperatures were “extreme.” Temperatures were 10 to 20 degrees below normal and Jan. 27 marked the highest day of winter energy demand in Duke Energy Carolina’s history. Meanwhile, Duke Energy has added 150,000 customers in North Carolina over the past two years.
“Energy conservation helps manage costs, but long-term reliability requires new infrastructure,” Bowman said. “Meeting customer demand – today and in the future – means investing in a system that can perform under the most extreme conditions.”
The company said that fuel recovery-related costs are passed through to customers without markup. The proposal seeks to bill the costs, $500 million for Duke Energy Carolinas and $309 million for Duke Energy Progress, over a period of 19 months rather than a year.
Previous pushback
The latest request comes after mounting frustration over Duke Energy bills, particularly following a winter in which many customers already reported sharp increases in their monthly costs. Tens of thousands of residents across the Carolinas have signed a petition calling for an independent audit of the utility, with many describing their bills as unexpectedly high and difficult to afford.
Last year, state lawmakers passed North Carolina Senate Bill 266 over Stein’s veto, a sweeping energy policy measure that changed how certain electricity costs can be recovered from customers. The law allows utilities like Duke Energy to more readily pass along fuel and energy expenses, including costs tied to market conditions.
Stein vetoed the bill, warning it would shift more financial risk onto customers.
“I vetoed Senate Bill 266 for exactly this reason: because it would further expose North Carolina ratepayers to volatile fuel markets and shift the cost of electricity from large industrial users onto the backs of regular people, making your utility bills more expensive,” Stein said.
Earlier this year, Stein and Attorney General Jeff Jackson also opposed Duke’s broader rate hike proposal, warning that additional increases could further strain household budgets.
Duke Energy Carolinas isn’t the only utility under scrutiny over what many describe as unreasonable and unaffordable rates. Piedmont Natural Gas, owned by Duke Energy, was criticized by homeowners early this year for winter gas bills reaching up to $900 in some cases. And like Duke Energy, Carolina Water Service has received backlash over its ongoing rate case before the NCUC to raise rates about 45% over the next three years.
