Rate increase could hike your electric bill $14/month

Rate increase could hike your electric bill $14/month

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by WCNC.com Staff

WCNC.com

Posted on February 4, 2013 at 6:09 PM

Updated Tuesday, Feb 5 at 8:36 AM

CHARLOTTE, N.C. -- Your utility bill could be going up if a rate increase request by Duke Energy is approved by the North Carolina Utilities Commission.

The overall average would be a 9.7 percent rate hike. It would likely hit residential customers the hardest, increasing their bills by 11.8 percent.

The average bill is about $102 right now, but could increase by about $14 each month.

The increase would be the utility’s third since 2009. The $446 million in new annual revenue would help pay for two new power plants and upgrades to two nuclear plants, among other capital expenses.

In January 2012 the commission allowed Duke to raise rates 7.2 percent, the largest increase in more than 20 years. In 2009, rates rose 7 percent over two years.

"Duke originally requested like 16 or 17 percent last time," said Wake Forest University Business School professor Dan Fogel. "They only got 7 percent. Then they had to satisfy those conditions for the merger, so that put some of the rate increases on hold...so they are back again."

He believes the state Utilities Commission will approve Duke's request.

"I think they are going to get the whole thing, or close to it. I also think, in a couple years, you're going to see a couple more of these increases."

Fogel pointed out Duke Energy rates are below the national average. NBC Charlotte checked the rates of other major, investor-owned power companies across the nation and did find Duke's rate to be on the lower end.

Still, the latest request is likely to prompt a consumer backlash as the ailing economy slowly recovers.

"It does hurt the consumer," said Fogel. "Energy will soon become a significant part of their expenses. I do think that maybe one of the things the state needs to look at is how we are going to cushion people in the interim. Duke hasn't paid that much for low-income people -- about $30 million since 1985 -- which, quite frankly, isn't very much."

Mecklenburg County’s December unemployment rate was 9.3 percent and many customers say they can’t afford higher utility bills. Consumer groups, including the powerful AARP, are already gearing up to fight a rate hike.

The Charlotte Observer contributed to this report.

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