Progress Energy Carolinas files rate increase request

Citing the cost of building new, gas-fired power generation, as well as higher operating expenses, Progress Energy Carolinas, a subsidiary of Duke Energy (NYSE: DUK), on Oct. 12 filed a request to increase North Carolina retail rates, the company's first general rate increase request since 1987.

In a filing with the N.C. Utilities Commission (NCUC), Progress Energy seeks to increase annual base revenues by approximately $387 million, or an average of 12 percent.

The total net residential increase, as proposed, would average 14.2 percent. The bill for an average residential customer using 1,000 kWh per month would increase to $119.94 from the current $105.15. That includes an increase in the standard customer charge to $13.50 per month from the current $6.75.

The average net increase for commercial and industrial customers would be about 9 percent. Progress said the largest portion of the request is for investments made to modernize the power system.

Progress Energy Carolinas is retiring 12 coal-fired units at five sites in the Carolinas, representing more than 1,660 MW of generating capacity, and replacing them with natural gas-fueled combined-cycle plants.

Progress has invested more than $1.3 billion in bringing two gas-fired plants online in the last 16 months in Richmond and Wayne counties in North Carolina. A third combined-cycle plant is under construction near Wilmington, N.C., and is scheduled for completion in late 2013.

The filing requests that new rates take effect in mid-2013.

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