Summary
Duke Energy Carolinas, LLC, a subsidiary of Duke Energy Corporation, has announced a settlement agreement with the North Carolina Public Staff regarding a requested base rate increase. This settlement, filed on October 20, 2009, proposes an 8% base rate increase, amounting to $315 million, effective January 1, 2010. This marks the first base rate adjustment for the company in North Carolina since 1991. The agreement also includes provisions to mitigate the immediate impact on customer bills by deferring the collection of financing costs for the Cliffside modernization project until January 1, 2011, and accelerating the return of regulatory liabilities related to fuel costs and nuclear insurance distributions. The settlement outlines a Return on Equity of 10.7% and a capital structure of 52.5% equity and 47.5% long-term debt. Notably, Duke Energy Carolinas has agreed not to file for another rate case before 2011, with any subsequent rate changes not taking effect before 2012.
Key Highlights
- 1Duke Energy Carolinas reaches a settlement with North Carolina Public Staff on a base rate increase.
- 2Proposed base rate increase of $315 million (approximately 8%) to be effective January 1, 2010.
- 3This is the first base rate increase for Duke Energy Carolinas in North Carolina since 1991.
- 4Financing costs for Cliffside modernization project collection deferred to January 1, 2011, to lower customer bill impact.
- 5Settlement includes a Return on Equity (ROE) of 10.7% and a capital structure of 52.5% equity / 47.5% debt.
- 6Duke Energy Carolinas agrees not to file a new rate case before 2011, with changes effective no earlier than 2012.
- 7The settlement is subject to approval by the North Carolina Utilities Commission.