Electric bills for the average residential Duke Energy customer in North Carolina are going up by about $7.50 a month, under a rate increase approved by state regulators. The company originally asked for a nearly 12 percent rate hike for residential customers, but settled for a boost of just over five percent that will be phased in over the next three years.
Duke Energy's justification for this rate increase is the same as it has been for the last two.
Duke Energy spokeswoman Lisa Parrish says the company needs to recover billions of dollars it has invested in new power plants.
"We're retiring older, less-efficient coal plants that were built in the mid-1990s, and in their place we've built two new facilities that are more environmentally friendly and more efficient," says Parrish, referring to Duke's new Cliffside coal plant in Mooresboro and a natural gas plant in Eden.
Also included in Duke's latest rate increase, is a 10.2 percent rate of return for the company's shareholders. North Carolina Attorney General Roy Cooper sued state regulators over allowing a similar rate of return in Duke's last rate hike and the court ordered a more thorough analysis of how such a return would hurt Duke's customers during an economic downturn.
In gaining approval for this latest rate hike, Duke Energy has promised not to seek another for at least two more years.
But Cooper says he will appeal Duke's newly-approved 5-percent rate increase, calling it unfair to utility customers:
The profit margin that Duke Energy is allowed to make is 10.2 percent. When you have double digit profit margin in this economy – that's just too much. There are a lot of working families and businesses that are on the edge, struggling to try to make it. They'd love a double-digit profit margin."
Cooper's previous challenge resulted in the court ordering a more thorough analysis of how such a return for the company's shareholders would hurt its customers Duke Energy and the North Carolina Utilities Commission went it to a lot more detail about their analysis of that issue this time around, but Cooper says it's just "lip-service."