Duke Energy files for 15 percent rate increase

The Tribune Staff Reports


Duke Energy has filed a rate increase request with the Indiana Utility Regulatory Commission to increase its annualized revenue by $395 million, for an overall average rate increase of about 15% across all customer groups.

If approved, the increase will be added to bills in two steps, approximately 13% in mid-2020 and 2% in 2021. Timing will depend on state regulatory commission action, the company said.

The increase will vary among consumers depending on the cost to serve different types of customers, Duke officials said. If approved by the commission, the company’s typical residential customer using 1,000 kilowatt-hours a month could expect a monthly bill increase of about $23, or about 77 cents per day, which includes both steps of the increase.

“We’ve made investments to meet the needs of a customer base that has grown by more than 100,000 since our last full-scale rate review,” said Duke Energy Indiana President Stan Pinegar. “We also have environmental responsibilities and are taking significant steps to reduce our greenhouse gas emissions and move to a cleaner power generation mix. And we are upgrading our electric grid to improve reliability, help avoid power outages and speed service restoration when outages do occur.”

To help customers save on their electric bills, the company is proposing a pilot program with time-of-use rates where customers can lower their bills on high power demand days by shifting their power usage to times of day when energy is less expensive.

The regulatory review process includes an opportunity for public comment.

In a news release, the company said it would use the additional revenue to upgrade and grow its system, including adding more than 1,400 miles of new power lines.

The company also plans to use the revenue to prepare for the likelihood of future greenhouse gas regulations and to accelerate retirement dates for some of Indiana’s coal-fired power plants. Nearly 90% of the power Duke Energy produced in Indiana in 2018 was generated from coal.

Federal rules are also requiring changes to the way the company manages coal ash stored at power plant sites, the company said. Duke Energy is closing ash basins at its power plants in compliance with stricter regulations, the company said.

The company said the cost to replace and upgrade equipment to reduce power outages and modernize the electric grid is increasing. Trees are a primary cause of power outages, and the cost per mile to trim trees has more than tripled, mostly in the last two years, the company said.

Duke has been installing smart meters for its Indiana customers which can be read automatically to reduce the need for estimated bills. The company is proposing the elimination of convenience charges for residential customers when they use a credit or debit card to make a bill payment.

Noting that customer power usage has been declining due to energy efficient appliances and successful energy efficiency programs, the company is proposing a five-year program for residential and commercial customers to tie company revenues to the number of customers served instead of the amount of power they use.

According to the company, the program removes the incentive for utilities to increase the use of electricity and allows utilities to continue to aggressively support customer energy efficiency programs. A number of electric utilities have moved to this model, and it is often currently used by gas companies, according to Duke.

[sc:pullout-title pullout-title=”About Duke Energy” ][sc:pullout-text-begin]

Duke Energy Indiana, a subsidiary of Duke Energy, provides about 6,600 megawatts of owned electric capacity to approximately 840,000 customers in a 23,000-square-mile service area, making it Indiana’s largest electric supplier. The company serves customers in Bartholomew County and Columbus.

To learn more about Duke Energy’s proposed rate increase, visit duke-energy.com/IndianaRates.

Customers can visit duke-energy.com/home/savings for energy-saving tips and programs. The company also has programs to help customers with managing their bills. Learn more at duke-energy.com/home/billing/special-assistance.