Proposed Duke Energy Carolinas rate hike is much smaller now

GREENVILLE — Electric customers across the Upstate could see very small increases to their monthly bills next March if state regulators approve a compromise on Duke Energy’s July rate increase proposal.

Residential customers using 1,000 kilowatt-hours per month will see an initial increase of 84 cents per month to their bills starting March 1, from $136.82 to $137.66. In two years, that bill will increase by another $4.21 per month to $141.87.

Duke Energy Carolinas, a subsidiary of the Charlotte-based publicly traded company, said the rate increase is needed primarily to cover the cost of improvements the company has made to transmission and distribution systems to improve grid reliability and resiliency, as well as the increased cost of capital required to fund those improvements.

The increase — although coming as the cost of living rises — is much smaller than earlier increases made by Duke, which serves 680,000 customers throughout the Upstate. Under that proposal a household’s 1,000-kilowatt monthly bill would have increased from $10.38 to $147.19.

According to the agreement, overall, the annual revenue increase for Duke will be $74.2 million instead of the initially proposed $150.5 million.

The partial settlement, which was filed with the SC Public Service Commission on Nov. 11, was reached by Duke and several co-intervenors, including environmental, consumer and small business advocacy groups, businesses and state agencies representing the public interest.

Its terms are similar to the settlement proposed in October for a rate case involving Duke Energy Progress, a subsidiary that serves the state’s PD area.

“This agreement contains the exciting provisions needed to help South Carolinians at a time when the cost of living is high,” said Kate Mixson, a senior attorney at the Southern Environmental Law Center, which is representing some environmental groups in the case. “As a result, customers will be able to better control their bills and reduce grid costs with energy efficiency and clean energy programs.”

Those provisions would require Duke to join future PSC proceedings to consider how to protect residents from potential future costs associated with rising power needs, driven mostly by data centers and other “large load” users. There are also other provisions to improve energy efficiency, including weatherization and a solar plus battery program.

The two sources of credits will help partially offset increased bills for Duke customers, said Ryan Mosier, Duke Energy spokesman.

It includes a fixed, two-year infusion of $100 million in federal tax credits, which are expected to be given to Duke for energy production from renewable sources such as solar, nuclear and hydroelectric, and a $750,000, two-year annual shareholder-fund contribution.

“If approved, this agreement allows us to keep pace with the needs of the growing state rather than lagging behind, so we can continue to support reliability and long-term economic growth for the communities we serve,” Mosier said.

However, this increase comes at a time when the cost of living in South Carolina has reached an all-time high.

When utilities and regulators raise rates — as typically happens with rising prices — those changes are felt most by low-income households and those on fixed incomes.

Rising energy costs aren’t just for the Upstate, Duke or South Carolina. But in the Palmetto State, electric bills are expected to rise by the most among all but one U.S. state over the next decade. That’s partly thanks to sweeping federal legislation that gutted clean energy incentives that were expected to help drive down the cost of electricity.

Duke’s proposed rate increase follows the August 2024 rate increase approved by the PSC, the company’s first in five years. This increase would have been larger, but it was split into two increases to prevent rising house prices. The second part will become effective on August 1, 2026.