Duke Energy Seeks Increase on Natural Gas Rates
Duke Energy announced Tuesday that it is asking the Kentucky Public Services Commission to review the utility's natural gas rates.
Duke filed a request with the state regulator on Tuesday and said that the move follows significant investments made to Northern Kentucky's natural gas distribution system, making it more reliable and resilient.
Customers would see a rate increase, the company said.
Duke Energy Kentucky has invested nearly $190 million in a variety of capital projects across Northern Kentucky since it last asked regulators to approve a natural gas base rate increase in 2018, a news release said. And, since that time, the company’s costs to operate and maintain its system have remained nearly flat, the company said.
These investments include the installation of new infrastructure, including natural gas pipelines, retiring and replacing equipment in order to ensure customers have the natural gas service they expect and deserve.
“In Northern Kentucky, it is critical that we continue to make smart investments to improve the reliability and resiliency of our natural gas delivery system,” said Amy Spiller, president of Duke Energy Ohio/Kentucky. “These are strategic investments in our infrastructure and our region that are providing benefits to our customers today and for decades to come.”
Among the company's Northern Kentucky investments, part of a recent multimillion-dollar series of projects:
- The Boone County natural gas infrastructure project, under construction since 2020, spans 7 miles from Turfway Road ultimately ending on Camp Ernst Road. The first portion of this project went into service at the end of 2020, and the second segment is scheduled to be in service this winter. This project was constructed in response to load growth and to enhance system reliability.
- The Three Mile Station project involved the replacement of an existing natural gas regulator station in Wilder. The main components of the project include engineering design, procurement, and construction of the replacement facility.
As part of its request, Duke Energy Kentucky seeks approval to increase its current natural gas base rates by approximately $15.2 million. The company delivers natural gas to over 100,000 customers in seven counties in Northern Kentucky.
Under the company’s proposal, residential customers who use an average of 57 100-cubic-feet (Ccf) per month will see an $8.77 – or 12.7% – increase on their monthly natural gas bills, from $69.31 to $78.08.
This proposed increase will vary depending on the amount of natural gas a customer uses, a customer’s rate type and the prevailing cost of the natural gas commodity.
The company is also seeking approval of a new mechanism to track costs associated with the company’s obligation to adhere to governmental directives or mandates (Rider GMA). These mandates include changes in federal or state tax rates, and those promulgated by federal governmental entities and agencies that require the company to upgrade or replace our natural gas delivery infrastructure. Rider GMA would act as either a credit or a charge to customers, depending upon the impact of the governmental mandate. Duke Energy Kentucky’s proposed Rider GMA will be applicable to all natural gas customers.
Once the Kentucky Public Service Commission deems the filing to be complete, they will set up a schedule for upcoming activities associated with the rate review case. The process will include opportunities for customers and other stakeholders to learn more about the company’s request and provide testimony to be included in the docket. Duke Energy Kentucky expects the rate review process to last until the end of 2021.
Photo via Duke Energy