After rising this past September and rising again in May, electricity rates from the Fayetteville Public Works Commission are expected to drop this coming September.
The PWC’s board voted unanimously on Wednesday to hold a public hearing Aug. 14 to take comments on a new power supply adjustment for its customers. The power supply adjustment is a charge or a credit that is added or subtracted from customers’ power bills.
It’s a charge the PWC levies when it pays more for wholesale electricity from Duke Energy than it expected, and it’s a credit when the PWC pays less than it expected to pay. Duke provides most of the PWC’s electricity.
Since September, PWC customers have been paying a power supply adjustment of 0.635 cents per kilowatt hour. If a home used 1,000 kilowatt hours of electricity in a month, this added $6.35 to the resident’s bill.
That charge expires at the end of August, PWC spokesperson Gavin MacRoberts said. By then, it’s expected to have generated $12.5 million in revenue, he said.
The new charge is expected to be about half of the old charge, MacRoberts said. It would be in effect for one year, from September 2024 to August 2025, bringing in about $6.4 million.
Rate increase history
The PWC cut its electricity rates by 4.7% in 2020, the PWC has previously said. This price cut applied to rates that took effect in May 2019, according to news reports The Fayetteville Observer published in 2019 and 2020.
Rates rose in May 2023, the current power supply adjustment took effect in September and a 2% rate increase took effect this past May.
Another 2% increase is scheduled for May 2025, but it will be offset by a $2-per-month reduction on bills scheduled to end at the same time. Customers have been paying the $2 monthly fee to help Duke Energy cover the cost of clearing coal ash from its old coal-fired power plants. Duke had to clean up the coal ash from all its plants because a coal-ash storage pond at one of its plants burst in 2014, and spilled millions of tons of ash into the Dan River.
Payment in advance to Duke Energy
In a related matter, the PWC board voted unanimously to make a $6.2 million payment early to Duke Energy to avoid more than $500,000 in interest charges.
A memo from PWC Chief Financial Officer Rhonda Haskins says Duke’s monthly energy costs this year have been trending higher than the Duke’s billing rate for the PWC. At the end of the year, the PWC has to make a “true-up” payment, plus 8.5% interest, to make up the difference.
Duke agreed to take payment in advance and forgo the interest, spokesperson MacRoberts said.
Senior reporter Paul Woolverton can be reached at 910-261-4710 and pwoolverton@cityviewnc.com.
This story was made possible by contributions to CityView News Fund, a 501(c)(3) charitable organization committed to an informed democracy.
We, as consumers of Duke Power’s electricity, should be entitled to receive a reimbursement from Duke for the surcharges due to Duke’s negligence in securing coal ash.
It pains me to know we are paying for mistakes that occurred over several decades even before CP&L was absorbed by Duke Energy.
Duke Energy should be solely responsible for this catastrophe and the cost should be borne by Duke.
It burns me more to know that when Duke Energy CEO negotiated with the Utilities Commission the surcharges, they were awarded millions in bonuses.
Please check into this and report.
Why consumers must pay for Duke’s mistakes? Why consumers must pay for Chemours’ mistakes?
Who is standing up for us?