Summary
Duke Energy Ohio, Inc., a subsidiary of Duke Energy Corporation, has filed an application with the Public Utilities Commission of Ohio (PUCO) seeking to establish a cost-based capacity charge. This filing is a crucial step in Duke Energy Ohio's strategy to recover embedded costs for capacity services under a new state compensation mechanism for Fixed Resource Requirement (FRR) entities. The company, designated as an FRR entity in PJM Interconnection until May 2015, is requesting an order to determine this charge, allow for deferral of the difference between market rates and actual costs, and establish a rider for future collection of these deferred amounts. This application is part of Duke Energy's broader effort to comply with its Electric Security Plan, which requires the transfer of legacy generation assets to an affiliate or subsidiary by the end of 2014. The PUCO filing signifies Duke Energy Ohio's proactive approach to managing its capacity costs and ensuring financial recovery mechanisms are in place as it navigates regulatory requirements and market dynamics.
Key Highlights
- 1Duke Energy Ohio filed an application with the Public Utilities Commission of Ohio (PUCO) on August 29, 2012.
- 2The application seeks to establish a cost-based capacity charge for Duke Energy Ohio as a Fixed Resource Requirement (FRR) entity.
- 3Duke Energy Ohio is an FRR entity in PJM Interconnection until May 31, 2015.
- 4The company is requesting PUCO to determine the specific amount of the cost-based capacity charge.
- 5The filing also seeks authorization to defer the difference between market-based capacity rates and the actual cost of providing capacity services.
- 6A new rider mechanism is requested to collect the deferred amounts in a future proceeding.
- 7This action aligns with Duke Energy's ongoing process to transfer legacy generation assets to an affiliate/subsidiary by December 31, 2014, as per its Electric Security Plan.