WILMINGTON, NC (WWAY) -- It looks like power rates are going up for a lot of people in southeastern North Carolina.
Progress Energy Carolinas says it has reached an agreement with the North Carolina Utilities Commission Public Staff to raise its rates as early as this summer.
The power company says under the terms of the settlement, the net increase to customers would be $151.4 million the first year and $183 million the second year, or an average increase of 5.7 percent for all customers by the second year.
The increase in year two accounts for $31.4 million in costs associated with the ongoing construction of new natural gas combined-cycle generation at the Sutton Plant in Wilmington. Progress Energy has has requested the new rates go into effect June 1.
Progress Energy originally requested an average increase in retail revenues of 11 percent, or $359 million.
In a news release, Progress Energy outlined several "Major Components" of the deal, including:
-The settlement includes a return on equity (ROE) of 10.2 percent. Progress Energy Carolinas had originally requested 11.25 percent.
-The settlement includes a capital structure of 53 percent equity and 47 percent debt. The company had requested a 55.4 percent equity component.
-Progress Energy will contribute an additional $20 million to help low income customers in North Carolina pay their energy bills and to provide training that improves worker access to jobs and increases the quality of the workforce. The company will be allowed to reduce its cost of removal liability by $20 million.
-The settlement also includes support for the company's proposed nuclear levelization accounting and for a new coal inventory rider allowing the company to recover carrying costs on coal inventory levels above those included in base rates.
The company says some issues are still unresolved, and will be decided by the North Carolina Utilities Commission, including:
-The allocation of the overall rate increase among customer classes (i.e. residential, commercial and industrial)
-The company's change to a single coincident peak cost allocation factor
-The industrial economic recovery rider proposed by the company
-Resolution of the deferral request for combined cycle units at the Smith Complex in Richmond County (currently pending in another docket)
The Utilities Commission is conducting hearings around the state, including one in Wilmington last month, to get public input on the rate increase proposal. The commission will hold a hearing in Raleigh March 18 to consider the settlement and the other unresolved issues.