Attached files
| file | filename |
|---|---|
| 8-K - 8-K - DUKE ENERGY PROGRESS, LLC. | a13-6271_18k.htm |
Exhibit 99.1
Progress Energy Carolinas
Summary of Settlement Agreement with North Carolina Public Staff
Docket E-2, Sub 1023
Background
· On October 12, 2012, Progress Energy Carolinas (PEC) filed a rate case with the North Carolina Utilities Commission (NCUC) to request an average 11% increase in retail revenues, or approximately $359 million
· The filing requested a net $359 million increase in rates, which is net of a $28 million reduction in the Demand-Side Management/Energy Efficiency clause
· The filing was based upon 11.25% return on equity (ROE) and a 55.4% equity component of the capital structure
· On February 25, 2013, PEC reached agreement with the North Carolina Public Staff, who represents consumers (see details below)
Major Components of Settlement
· Based upon ROE of 10.2% and a 53% equity component of the capital structure
· Average rate increase of 5.7% for all customer classes by year two
· PEC will make a one-time $20 million contribution to help low-income customers in North Carolina pay their energy bills
· The Company will be allowed to reduce its cost of removal liability by $20 million
· Settlement includes support for the Company’s proposed nuclear levelization accounting and for a new coal inventory rider allowing the company to recover a return on coal inventory levels above those included in base rates
· All issues were not settled with the Public Staff. Key matters left open for NCUC decision are:
· PEC’s change to a single coincident peak cost allocation factor
· The industrial economic recovery rider proposed by PEC
· Resolution of the Richmond CC deferral request (currently pending in another docket)
· Settlement subject to the review and approval by the NCUC
· Hearing is scheduled to commence March 18, 2013
Estimated Rate Increase Impacts to Customer Bills
|
($ in millions) |
|
Year One |
|
Year Two |
| ||
|
Base rates |
|
$ |
211 |
|
$ |
211 |
|
|
Decrease in DSM/EE Rider |
|
(28 |
) |
(28 |
) | ||
|
Deferral of Sutton CWIP Cash recovery (no earnings impact through in service date) |
|
(31 |
) |
— |
| ||
|
Cumulative Net Increase to customers ($) |
|
$ |
151 |
|
$ |
183 |
|
|
Cumulative Net Increase to customers (%) |
|
4.7 |
% |
5.7 |
% | ||
|
One time donation expense |
|
$ |
20 |
|
— |
| |
|
One time reduction of regulatory liability |
|
$ |
(20 |
) |
— |
| |
Reconciliation of Request
|
($ in millions) |
|
Year One |
|
Year Two |
| ||
|
Original request |
|
$ |
359 |
|
$ |
359 |
|
|
Supplemental filing update |
|
5 |
|
5 |
| ||
|
Reduced ROE and capital structure |
|
(91 |
) |
(91 |
) | ||
|
Lower decommissioning expense, depreciation and amortizations (no earnings impact) |
|
(62 |
) |
(62 |
) | ||
|
Deferral of Sutton CWIP Cash recovery (no earnings impact through in service date) |
|
(31 |
) |
— |
| ||
|
Other |
|
(29 |
) |
(29 |
) | ||
|
Per Settlement Agreement |
|
$ |
151 |
|
$ |
183 |
|