Molly Ayala
Duke Energy Progress is a subsidiary of Duke Energy that supplies electricity to millions of residential, commercial, and industrial customers across North Carolina and South Carolina. The company's rates are reviewed annually by the North Carolina Utilities Commission (NCUC), which assesses fuel costs and state programs to encourage clean energy adoption. Duke Energy Progress' rates are adjusted to reflect the actual costs of fuel, with customers paying what the company pays to generate electricity. In 2024, Duke Energy Progress lowered its rates by 4.5% for residential customers, with commercial and industrial customers also benefiting from decreases. However, in 2022, the company requested a review of its rates to fund system improvements, which could result in limited annual rate increases. Duke Energy has also proposed a Multi-Year Rate Plan (MYRP) to gradually increase rates over three years. The company aims to balance maintaining affordable rates with investing in cleaner power and improving the customer experience.
| Characteristics | Values |
|---|---|
| Date of rate change | 1st of December 2024 |
| Rate change | -4.5% |
| Reason for rate change | Annual adjustment for the cost of fuel used to generate electricity |
| Typical residential customer bill before rate change | $161.97 |
| Typical residential customer bill after rate change | $154.63 |
| Typical residential customer usage | 1,000 kilowatt-hours (kWh) per month |
| Commercial customer rate change | -6.3% |
| Industrial customer rate change | <-0.1% |
| Number of Duke Energy Progress customers | 1.5 million |
| Location of Duke Energy Progress customers | Central and eastern North Carolina, including Raleigh and Asheville |
| Base rate | Covers the company's cost to operate and maintain the electric system |
| Fuel rate | Covers the company's costs for coal, natural gas, uranium, and other fuel-related items |
| Low-Income Affordability Collaborative (CAP) | Short-term (12-month) bill credit of $42 per month for vulnerable customers |
| Rate as of January 1, 2025 | -6.2% |
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What You'll Learn
Duke Energy Progress North Carolina rate review request
Duke Energy Progress has requested a rate review by the North Carolina Utilities Commission (NCUC) to build a cleaner and smarter energy future. The company supplies electricity to around 1.7 million customers across North Carolina and South Carolina and is aiming to reduce its reliance on fossil fuels and transition to cleaner energy sources.
On October 6, 2022, Duke Energy Progress asked the NCUC to review its rates, with a focus on strengthening the electricity grid, reducing power outages, and supporting economic development. The company has invested over $3 billion in its generation, transmission, and distribution infrastructure since its last rate case in 2019. This has resulted in significant infrastructure improvements, avoiding more than 1.3 million extended customer outages and saving over 3 million hours of total lost outage time.
The rate review request includes a three-year plan to fund system improvements, with a focus on limiting annual rate increases and providing cost certainty for customers. The proposed Multi-Year Rate Plan (MYRP) aims to gradually increase rates over three years, with an 8.5% net increase in retail revenues in the first year, followed by 3.9% and 3.6% increases in the second and third years, respectively. This translates to a monthly increase of $14.72 for a typical residential customer using 1,000 kilowatt-hours (kWh) per month, starting October 1, 2023.
Duke Energy Progress recognizes the financial pressures its customers face and is committed to keeping rates as low as possible. To support vulnerable customers, the company has proposed a Customer Assistance Program (CAP) that offers a short-term 12-month bill credit of $42 per month for those enrolled in the Low-Income Energy Assistance Program (LIEAP) and Crisis Intervention Program (CIP).
The NCUC will hold public hearings and consider stakeholder input during the evaluation process, ensuring that any rate increases are justified and aligned with the expectations of customers and investors.
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Base rates and fuel rates
Base Rates
Base rates cover the cost of operating and maintaining the electric system, including the opportunity to earn a fair return for investors. These rates are adjusted periodically to align the rates paid by customers with the company's costs of serving them. Duke Energy Progress has taken steps to improve the service and interactions customers have with the company since the last base rate increase. The company has reduced its annual operating costs by more than $100 million between 2018 and 2021, and these savings will be passed on to customers.
Fuel Rates
The fuel component of the rates covers the company's costs for coal, natural gas, uranium, and other fuel-related items to keep its power plants running. The prices reflect the actual costs incurred by the company to fuel its power plants, and customers pay the same amount. Duke Energy Progress is transitioning to generation that is less reliant on fossil fuels to reduce price swings. The fuel rate increases or decreases annually on December 1.
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Customer bills and costs
Duke Energy Progress is a subsidiary of Duke Energy that owns 13,800 megawatts of energy capacity, supplying electricity to 1.7 million residential, commercial, and industrial customers across a 28,000-square-mile service area in North Carolina and South Carolina.
Duke Energy Progress' customer bills and costs are influenced by various factors, including fuel costs, base rates, and regulatory adjustments.
Fuel Costs
The cost of fuel used to generate electricity at Duke Energy Progress' power plants is a significant component of customer bills. These fuel costs include expenses for coal, natural gas, uranium, and other fuel-related items necessary to keep the power plants running. Duke Energy Progress works to actively manage fuel contracts to keep costs low for its customers. The company also benefits from carbon-free nuclear energy, which provides about half of North Carolina's generation and helps minimize price swings.
Annually, on December 1, the fuel component of the rates increases or decreases to reflect the actual costs incurred by the company. This adjustment ensures that customers pay the same fuel prices as the company. For example, in 2024, an 8.8% drop in fuel prices led to a 4.5% decrease in rates for residential customers in North Carolina, resulting in an average savings of $7.34 per month for those using 1,000 kilowatt-hours (kWh).
Base Rates
Base rates cover the company's cost of operating and maintaining the electric system, including returns for investors. These rates are adjusted periodically to align with the costs of serving customers. For instance, in 2022, Duke Energy Progress requested a review of its rates as it worked to strengthen its grid, reduce carbon emissions, and improve customer experience. The company proposed a Multi-Year Rate Plan (MYRP) with gradual increases over three years to fund system improvements.
Regulatory Adjustments and Programs
Duke Energy Progress works with regulatory bodies like the North Carolina Utilities Commission (NCUC) to ensure fair rates and promote clean energy adoption. The NCUC annually reviews fuel costs and rider updates for state programs. Additionally, Duke Energy Progress has proposed programs to support low-income customers and improve energy efficiency. For instance, the Low-Income Affordability Collaborative developed a short-term bill credit of $42 per month for vulnerable customers, and the company refers eligible customers to income-qualified weatherization and energy efficiency services to reduce their energy usage and lower bills over time.
Duke Energy Progress strives to balance the needs of its customers, investors, and regulatory requirements while managing fuel costs and base rates to provide reliable and affordable electricity to its service areas.
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Lower rates for 2025
Duke Energy bills in North Carolina are set to decrease for 2025, with a 6.2% rate cut that came into effect on January 1. This reduction is part of an annual adjustment for the cost of fuel used to create electricity. The North Carolina Utilities Commission (NCUC) reviews the fuel costs required to generate electricity for customers annually, along with rider updates for state programs encouraging clean energy adoption and reduced energy use.
The NCUC approved a 4.5% decrease in rates for Duke Energy Progress residential customers in North Carolina on December 1, 2024. This decrease was also influenced by an 8.8% drop in fuel prices. A typical residential customer in North Carolina using 1,000 kilowatt-hours (kWh) per month saw an overall decrease of $7.34, with rates falling from $161.97 to $154.63. This is 11% below the national average of $174.21, resulting in a difference of approximately $235 per year. Commercial customers will benefit from an average decrease of about 6.3%, while industrial customers will see an average decrease of less than 0.1%.
Duke Energy Progress serves about 1.5 million customers in central and eastern North Carolina, including Raleigh and the Asheville region. The company owns 13,800 megawatts of energy capacity and supplies electricity to 1.7 million residential, commercial, and industrial customers across a 28,000-square-mile service area in North Carolina and South Carolina.
Duke Energy Progress has proposed a gradual increase over three years in a Multi-Year Rate Plan (MYRP) to align customer rates with the company's costs to serve them. However, the company is also working to strengthen its grid, reduce carbon emissions, and improve the customer experience.
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Duke Energy Carolinas
The company ranked 141st on the 2024 Fortune 500 list, its highest placement ever. Duke Energy's Midwest generation comes primarily from coal, natural gas, or oil, while half of its Carolinas generation is sourced from nuclear power plants. The company also operates conventional hydroelectric plants and uses natural gas turbines to manage peak demand.
Duke Energy has been working to strengthen its grid, reduce carbon emissions, and enhance its customers' experience. In October 2022, Duke Energy Progress requested a rate review from the North Carolina Utilities Commission (NCUC) to fund system improvements over three years. This plan aims to limit annual rate increases and provide customers with more cost predictability.
The proposed rate changes by Duke Energy Progress are designed to support cleaner power investments and economic development. The plan includes a fuel component that adjusts annually on December 1 to reflect the actual costs of fuelling power plants, with prices passed directly to customers.
Additionally, Duke Energy has introduced initiatives like residential decoupling, which links revenues to customer growth rather than usage growth, encouraging energy efficiency. The company also offers bill credits and referrals to weatherization services for low-income customers to ease their energy burden.
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Frequently asked questions
Duke Energy Progress electric rates vary depending on the location and the date. For example, as of December 2024, a typical residential customer in North Carolina using 1,000 kilowatt-hours (kWh) per month is charged $154.63.
The rates are influenced by the cost of fuel used to generate electricity, rider updates for state programs, and the opportunity to earn a fair return for investors.
The rates are adjusted periodically, but there is also an annual adjustment on December 1 to reflect the changing fuel costs.
Yes, Duke Energy Progress offers a short-term (12-month) bill credit of $42 per month for customers supported by the federally funded Low-Income Energy Assistance Program and Crisis Intervention Program.
