Understanding Your Bill

A kWh or kilowatt-hour is a measure of electric energy consumed by electric loads such as appliances in your home.  One kWh equals the electricity used by a 100-watt light bulb that burns for 10 hours.  Because energy is a continuous accumulation of usage, it is analogous to the odometer on your car.

A kW or kilowatt is the rate at which a customer consumes energy, and also measures the demand placed on Duke’s power plants. One kW of demand for one hour means that 1 kWh has been consumed. Because demand varies over time, it is analogous to the speedometer on your car.

The energy charge recovers costs for the electric energy (kWh) you consume in one billing period (approximately 30 days). It is represented in $/kWh or ₵/kWh. The monthly energy consumed is determined by subtracting the previous month’s meter reading from the current month’s meter reading. This charge is set in a general rate case and can only be changed in a general rate case.

Generally, the energy charge recovers costs that change with the amount of electricity you consume such as fuel used in power plants; however, for some customers, particularly residential customers, the energy charge recovers certain fixed (non-variable) costs such as the wires and poles that bring electricity to your home.

Rather than recovering costs solely based on the amount of electricity you used, a demand charge recovers costs based on how much electricity you used at a specific point in time.  The charge is typically calculated based upon your share of the overall system’s load at its peak.

Not all customers have a demand charge.  While some residential customers elect to have time-of-use (TOU) rates with a separate demand charge, most residential customers do not use TOU rates. Demand charges are more commonly assessed to commercial and industrial customers. This charge is set in a general rate case and can only be changed in a general rate case.

Generally, the demand charge recovers all or part of the fixed (non-variable) costs that occur based on your maximum electrical demand. For example, a certain number and size of power plants are necessary to supply the total electrical demand of all customers at a given point in time. The transformer that serves your home or business is another example of equipment that must be sized to meet a maximum demand.

The Basic Customer Charge is a fixed charge that recovers a portion of the specific costs to provide service to an individual customer. These costs include the meter that measures your electrical usage, the costs to read the meter and process the bill, and basic facilities to connect your home or business to the electrical grid, including the wires that run from your meter to the distribution or transmission lines that serve the entire grid. Even when a customer uses no kWh in a given month, the facilities must be in place so that electricity is available when the customer needs it. This charge is set in a general rate case and can only be changed in a general rate case.

The Storm Recovery Cost recovers the costs incurred by Duke to restore power after damage to its system following a major hurricane or ice storm. N. C. Gen. Stat. § 62-172 allows Duke to issue storm recovery bonds to finance these costs, which are repaid by this charge on your bill. The actual costs are tracked and trued-up every six months (January 1 and July 1).

The Summary of Rider Adjustments is a summation of various charges, authorized by North Carolina law, that change at different points throughout the year. These charges cover costs such as: the variable cost of fuel which changes year to year from what is included in the base Energy Charge described above; the cost of demand-side management and energy efficiency (DSM/EE) programs; certain renewable energy costs; costs to assist low-income households to pay their electricity bill; and refunds of over-collections due to a reduction in income tax rates. These charges are on a $/kWh or ₵/kWh and are applied to your monthly energy usage.

In most cases, no. Prior to the recent 2023 DEP general rate case (Docket No. E-2, Sub 1300) and DEC general rate case (Docket No. E-7, Sub 1276), these charges were included in the overall Energy charge, even though they were tracked separately. DEP and DEC changed their bill format with these rate cases to provide greater bill transparency. 

No, you are not being charged twice for the same costs. Most riders change annually, but the changes may not necessarily line up with your billing period of a given month. For example, DEP’s fuel rider changes on December 1 of each year. If your billing period is from November 15 – December 15, half of your energy usage for that period would be billed under the “old” fuel rate and half under the “new” fuel rate resulting in two distinct Summary of Rider Adjustment charges.

No. DEP’s DSM/EE rider changes on January 1. For DEC, most riders change on September 1, but like DEP, the DSM/EE riders change on January 1. And as mentioned above, the Storm Securitization Recovery Cost rider changes twice per year, January 1 and July 1.

This rider recovers the incremental costs (costs above the cost of non-renewable energy) of certain clean energy purchases Duke makes to comply with a North Carolina State law – N.C.G.S § 62-133.8 – approved in 2007 that mandates that electric utilities must procure a certain amount of their electricity sales from clean energy sources such as solar, wind, biomass, etc. Unlike other riders, this rider is assessed on a per account basis, meaning each residential, commercial, or industrial customer pays the same fixed amount by classification, regardless of monthly usage. This charge changes each September 1 for DEC and December 1 for DEP.

This charge is the State sales tax of 7% applied to your “Total Current Charges” from Duke Energy. Duke Energy does not keep this money, but instead remits it to the North Carolina Department of Revenue.

Both Duke Energy Progress (DEP) and Duke Energy Carolinas (DEC) filed for general rate increases in 2022 (DEP) and 2023 (DEC).  After lengthy investigations and hearings before the North Carolina Utilities Commission, DEP was granted a general rate increase effective October 1, 2023, and DEC effective January 15, 2024.

Pursuant to N.C.G.S § 62-133.8, which was enacted in 2021, DEP and DEC asked for, and received, approval to increase their respective base rates each year for the next three years.

DEP was granted an increase of 6.8% on October 1, 2023, an additional 3.4% increase that will become effective on October 1, 2024, and a further 3.7% increase that will become effective on October 1, 2025.

DEC was granted an increase of 8.0% on January 15, 2024, an additional 3.5% increase that will become effective on January 15, 2025, and a further 3.2% increase that will become effective on January 15, 2026.

No. As discussed above, and illustrated in the Annual Billing Adjustments Table, numerous riders change at other times of the year.  These changes are independent of base rate changes. Most of the recent rider changes have resulted in increases, particularly for fuel costs, renewable energy costs, and DSM/EE costs. These increases are on top of the increases from the general rate cases.

The Commission is required to consider any rate changes requested by Duke.  State and Federal laws require the Commission to approve rates that allow Duke to recover its reasonable expenses plus a reasonable return on its funds prudently invested to provide reliable electric service to its customers.

The Public Staff investigates Duke’s requests for rate changes and makes its recommendations to the Commission to ensure that Duke is operating prudently and spending money wisely so that its customers are not required to pay rates any greater than is required by State law.

The Commission’s final orders granting rate increases for the most recent general rate case filings are linked below:

Duke Energy Progress (Docket No. E-2, Sub 1300)

Duke Energy Carolinas (Docket No. E-7, Sub 1276)