Overview:
• PWC annually sets a new Power Supply Adjustment surcharge based on how much Duke Energy Progress charged it for wholesale electricity over the previous year.
• This year, cold weather and other factors pushed up Duke’s prices dramatically. Now the retail customers have to pay.
• Want to comment on the increase? Attend a public hearing on the price increase on August 26, or submit written comments by August 21.
Fayetteville Public Works Commission customers likely will start paying more for electricity starting September 1, when the city-owned utility expects to increase the price for the second time since May.
The average residential customer, using about 1,000 kilowatt hours per month, will pay about $1.24 more per month, PWC Chair Richard King told CityView on Wednesday. This is to partly cover $18.1 million in higher-than-predicted billings that Duke Energy Progress charged PWC for wholesale electricity this past winter, according to a PWC presentation.
Fayetteville endured two major winter storms with cold temperatures in January and February.
“We don’t want to up the rates. I never want to up the rates,” King said.
“This is Duke and their cost of doing business,” he said. “This is not us. We’re not just willy-nilly out there trying to raise everybody so we can make some money. That’s not the case. We’re paying our bill, is what we’re doing. We’re paying our bill.”
PWC buys most of its electricity from Duke. It’s Duke’s largest customer in North Carolina, King said. Over the first six months of 2026, the energy costs were 50% higher than Duke forecasted, the PWC document said.
PWC’s electricity prices for its customers rose in May when the city-owned utility implemented new basic rates. The increase on September 1 is an additional charge levied on top of the basic rates. As of June 2025, PWC had 86,466 electricity customers, including homes, businesses, offices and institutions, and industrial sites.
The public can comment on the proposed price increase at a public hearing on August 26. The meeting is set for 8:30 a.m. at the PWC office at 955 Old Wilmington Road in Fayetteville. The hearing notice includes directions for registering to speak and submitting comments.
Extra Charge Can Go Up or Down
Each August, PWC adjusts what it charges customers based on its previous year of billings from Duke Energy Progress. This is called the PWC’s Power Supply Adjustment. It’s currently $5.41 for 1,000 kilowatt hours. The new charge would be $6.63 per 1,000 kilowatt hours.
The charge is added to customer bills. PWC’s other rates vary based on the type of customer—residential, commercial, or industrial, for example—the time of day the customer uses electricity, and other factors. Residential customers pay $97.65 for 1,000 kilowatt hours consumed in off-peak demand hours, and $149.80 for 1,000 kilowatt hours consumed during on-peak demand hours.
Sometimes the Power Supply Adjustment goes up; sometimes it goes down. If PWC’s charges from Duke Energy are unexpectedly low in a given year, it’s possible for the adjustment to be a monthly credit on PWC customers’ electric bills.
According to archived pages from PWC’s website, the Power Supply Adjustment was first imposed in 2023. It was $6.35 per 1,000 kilowatt hours for the 12 months starting September 1, 2023. It was reduced to $3.27 per 1,000 kilowatt hours in September 2024. The current surcharge of $5.41 per 1,000 kilowatt hours was set a year ago.
If PWC approves the increase on August 26, the Power Supply Adjustment surcharge will rise to $6.63 on September 1. This would cover about $13.1 million of the $18.1 million extra that Duke charged PWC over the past year.
PWC would defer the remaining $5 million “to minimize customer impacts.” Otherwise, the surcharge would have been $2.55 per 1,000 kilowatt hours more, or $9.18 instead of $6.63.
Two Storms and Expensive Fuel
When Duke has to pay more to produce electricity, it passes these costs to its customers, including PWC, according to PWC’s presentation.
Winter storms and cold temperatures “elevated demand and stressed energy markets,” and natural gas prices rose more than 70% in late January, according to PWC. Natural gas powers many of Duke’s electricity generation plants.
Further, prices were pushed up by a limited natural gas supply, high exports of American natural gas to other countries, and “record heating demand and overall power generation.”
PWC’s January energy cost was 128% higher than forecast, or $8.4 million more. Its February cost was 106% higher, or $5.6 more, according to the utility.
Duke Energy Progress and PWC are working to improve their energy cost forecasts, according to PWC.
These efforts include better simulations and modeling; efficiencies expected from an upcoming merger of Duke Energy Progress with its sister company, Duke Energy Carolinas; and Duke is getting a new supply of natural gas, which is expected to mollify winter price hikes. PWC also will have the opportunity to challenge bill increases “when warranted,” according to the presentation.
Senior reporter Paul Woolverton can be reached at pwoolverton@cityviewnc.com.
