Duke Energy gets South Carolina PSC’s approval for new customer rates

The Public Service Commission of South Carolina (PSCSC) has approved new customer rates for Duke Energy Carolinas following a comprehensive rate review process that began in January of this year. This decision affects nearly 660,000 customers in the Upstate region of South Carolina, with the revised rates set to commence on August 1, 2024. The approval comes after detailed negotiations and settlements with various consumer, environmental, and industrial groups within the state.

Starting from August 2024, residential customers using 1,000 kilowatt hours per month will experience an increase of approximately 8.7%, which translates to an additional $12.06 on their monthly bills. A subsequent increase of 4.3% is scheduled for August 2026, adding another $6.42 to the monthly bills of the same customer profile. Commercial and industrial customers will also see an average rate increase of about 4.6% and 4.4%, respectively, although the specific impact will vary based on customer class and size.

These rate changes are part of Duke Energy’s strategy to recover investments aimed at enhancing system reliability, diversifying energy sources, and improving customer service. The adjustments also reflect efforts to address future energy demands through the integration of highly efficient energy units including natural gas, nuclear, solar, and hydroelectric sources.

The rate review was a public and involved process, culminating in a settlement agreement submitted in May and approved by the PSCSC. Key stakeholders in this agreement include the South Carolina Office of Regulatory Staff, the South Carolina Energy Users Committee, Southern Alliance for Clean Energy, Coastal Conservation League, Vote Solar, and the South Carolina Small Business Chamber of Commerce. Notably, major entities such as Walmart and CMC Recycling, while not signatories, did not object to the approval of the agreement.

Apart from the rate increases, the PSCSC’s order includes provisions for Duke Energy to recover costs related to new investments in the grid and its corporate headquarters. The company is also allowed to establish rates based on a return on equity of 9.94% and an equity component of the capital structure of 51.21%. One area of partial contention was the recovery of certain environmental compliance costs, which was the only aspect not fully approved in the settlement agreement.

In a move to support vulnerable customers, the PSCSC has sanctioned, at shareholder expense, a $2 million initiative to study and enhance regulatory programs and protections for low-income customers. This includes evaluating affordability programs and other initiatives that could increase participation in energy-saving programs like the South Carolina Local Weatherization Assistance Program.

Duke Energy is also actively promoting various energy efficiency programs to help customers manage and potentially reduce their energy usage. For those struggling to pay their bills, the company offers assistance through government and nonprofit programs, as well as its own Share the Light Fund, which provides energy assistance.

The PSCSC’s approval of new rates for Duke Energy reflects a balancing act between the need for utility infrastructure investment and consumer protection. This rate adjustment is crucial for supporting the long-term sustainability of energy provisions in South Carolina, ensuring that the infrastructure keeps pace with technological advancements and environmental standards.