Duke Energy Carolinas files S.C. rate increase request

Mon Mar 18, 2013 11:39am EDT

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CHARLOTTE, N.C.,  March 18, 2013  /PRNewswire/ -- Duke Energy Carolinas today
filed a request with the Public Service Commission of  South Carolina  (PSCSC)
to increase electric rates by about  $220 million, for an overall increase of
15.1 percent.


(Logo:  http://photos.prnewswire.com/prnh/20040414/DUKEENERGYLOGO  )

More than half of the request is driven by capital investments that Duke Energy
Carolinas has made in the electric system that serves 540,000 households and
businesses in  South Carolina.  

"As part of our ongoing fleet-modernization plan, we have recently built and put
into service two new, state-of-the art power plants that will provide cleaner
electricity and serve our customers reliably for decades to come," said  Clark
Gillespy, Duke Energy's  South Carolina state  president.  

"Our new  Dan River  natural gas plant does twice the job of the retired  Dan
River  coal plant, and it does so with significantly lower emissions," Gillespy
said. "Meanwhile,  new advanced technology at the Cliffside Steam Station,
completed at the end of 2012, removes 99 percent of sulfur dioxide emissions and
90 percent of nitrogen and mercury emissions."

The following chart illustrates the proposed average rate increase by customer
class:

 Customer Class  Average Rate Increase Percentage  
 Residential     16.3%                             
 Commercial      14.0%                             
 Industrial      14.4%                             
 Lighting        15.9%                             


This table shows the average impact of the proposed changes for each customer
class.   The specific increase or decrease to individual customers will vary
depending upon the rates they pay and other factors.

Today, a residential customer who uses 1,000 kilowatt-hours (kWh) of electricity
per month pays  $100.45. If the company's rate increase is approved as filed,
that bill will increase by  $17.83.

"Electric service for our customers is an excellent value. For our typical
customers, the daily cost of powering their homes is somewhere between the price
of a gallon of gas and a premium cup of coffee," Gillespy said. "Even with the
proposed increase, Duke Energy Carolinas' rates would remain below the national
average. When adjusted for inflation, our customers are still paying less for
electricity than they did in 1991."

Why Raise Rates?  
The proposed rate increase is needed to begin paying the company back for money
it has already invested in new, cleaner and more efficientpower plants and
equipment, and to comply with increasing state and federal regulations.

Examples of Duke Energy's electric system investments include:

* Dan River Combined Cycle Station in  Eden, N.C.  - This 620-megawatt plant
uses cleaner, lower-cost natural gas to replace a similar amount of older, less
efficient coal-fired generation. The capital cost included in this rate case is 
$673 million.
* Cliffside Steam Station Unit 6 in  Mooresboro, N.C.  - This 825-megawatt coal
plant employs state-of-the-art emission controls to remove 99 percent of sulfur
dioxide, 90 percent of nitrogen oxides and 90 percent of mercury. The
high-efficiency technology burns less coal per megawatt-hour of electricity
generated than most other coal units in the nation. The capital cost included in
this rate case is  $236 million.  
* Oconee Nuclear Station,  Oconee County, S.C.  - New safety and security
measures have been installed to continue to protect the plant from extreme
conditions or a natural disaster. The  Oconee  plant is a safe and efficient
source of carbon-free electricity generation. The capital cost included in this
rate case is  $141 million.
* McGuire Nuclear Station,  Mecklenburg County, N.C.  - Upgrades have been made
to the facility to make it more efficient, and to increase the amount of
carbon-free electricity it produces. The capital cost included in this rate case
is  $135 million.

In addition to the investments in new generation, the rate request also seeks to
cover:

* Improvements to the vegetation management program that will enhance overall
reliability to customers by reducing the likelihood of tree-related outages.
* Federally mandated, industry-wide nuclear power plant safety upgrades and
cyber security enhancements.

The impact of these new costs, as well as the company's existing costs, is
magnified  because these costs have been spread across lower sales volumes
experienced since the last rate case.

"We're committed to minimizing the impact of increased costs on our customers,"
Gillespy said. "We offer a number of energy-efficiency programs and assistance
for low-income customers. Since 1985, our Share the Warmth Program has given
more than  $33 million  to low-income customers for heating bills during the
winter season."  

Since the company's 2011 rate case, Duke Energy Carolinas and its customers,
employees and shareholders have provided about  $1 million  to these programs in
 South Carolina  communities.

Duke Energy made a  $4 million  donation to AdvanceSC, stemming from the
company's last rate case. Duke Energy created AdvanceSC in 2004 to support
communities in the company's  South Carolina  service territory through grants
for public assistance and economic development programs. Since its creation,
AdvanceSC has given more than  $67 million  to these programs.

Customers can help control their energy costs with efficiency programs. Learn
more at  http://www.duke-energy.com/youtility/.

The company's request proposes an allowed return on common equity (ROE) of 11.25
percent (the current allowed ROE in  South Carolina  is 10.5 percent) with a 53
percent  common equity component. The  South Carolina  retail rate base is
expected to be approximately  $4.3 billion  through the date of the hearings.

For more details on the company's request to increase rates, visit 
http://www.duke-energy.com/scratecase

Additional Information  
The testimony filed in support of the company's request can be viewed at the
PSCSC website (search using  Docket No. 2013-59-E).

Photos of some of the capital investments made in the Carolinas electric system
can be downloaded from  Flickr.

Duke Energy Carolinas  
Duke Energy Carolinas generates, transmits, distributes and sells electricity in
central and western  North Carolina  and western  South Carolina. Duke Energy
Carolinas' service area covers 24,000 square miles and supplies electric service
to 2.4 million residential, commercial and industrial customers.

Headquartered in  Charlotte, N.C., Duke Energy (NYSE: DUK) is a Fortune 250
company traded on the New York Stock Exchange under the symbol DUK. More
information about the company is available at:  www.duke-energy.com.

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SOURCE  Duke Energy

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