Duke Energy Infrastructure Plan
In a June 29, 2016 order, the IURC approved a seven-year plan for electric transmission, distribution and storage system improvements for Duke Energy, including incremental rate recovery of those costs as the projects proceed. The utility refers to the program as its Transmission and Distribution Infrastructure Improvement Plan (T&D Plan).
While the utility had originally proposed a $1.83 billion plan, the Commission's order approved a settlement agreement that will cap rate recovery for the plan's projects at $1.4 billion. The OUCC's March 7, 2016 news release offers a summary of the agreement.
The OUCC issued a January 19, 2016 news release to invite consumer comments.
Duke Energy filed its request under a law (Senate Enrolled Act 560) passed by the Indiana General Assembly in 2013.
In a separate case, the IURC denied Duke Energy's first request for such a plan in May 2015. The OUCC's May 8, 2015 news release offers more information.
Duke Energy's first requested rate adjustment under the approved plan received IURC approval on March 22, 2017. It raised the monthly residential electric bill for a customer using 1,000 kWh by $1.51. The OUCC filed testimony on the proposed tracker change (Gruca and Golden) on January 11, 2017.
The second rate adjustment requested by Duke Energy received IURC approval on October 17, 2017. It will raise a monthly residential electric bill for 1,000 kWh by an additional $0.55. The OUCC filed testimony (Gruca and Alvarez) on June 27, 2017.
Duke Energy's third TDSIC rate adjustment, if approved, would increase a monthly 1,000 kWh residential bill by an additional $1.61. The OUCC anticipates filing testimony on June 27, 2018. To review the case file, please click here.
A brief summary of the 2013 law
Indiana Code 8-1-39 allows electric and natural gas utilities to submit 7-year infrastructure improvement plans for IURC approval. It requires the IURC to rule within 210 days once such a request is filed.
- Once a 7-year plan receives IURC approval, the utility may request incremental rate increases every 6 months to pay for the projects. The rate adjustment is referred to as the Transmission, Distribution and Storage System Improvement Charge (TDSIC). The IURC has 90 days to rule on such a request.
- TDSIC rate increases are limited to no more than 2 percent of a utility's total retail revenues.
- The TDSIC rate mechanism (or tracker) allows the utility to recover 80 percent of the costs as they are incurred. The remaining costs are deferred until the utility's next base rate case, which must be filed before the end of the 7-year period.
Duke Energy's request
All public filings in cause number 44720, including settlement testimony, are available on the IURC website.
According to the utility's testimony and exhibits:
- Projects throughout Duke Energy's Indiana service territory include breaker and relay replacements, replacement of aging infrastructure (including transformers, substations, poles, and lines), vegetation management, and other proposals.
- Under the settlement agreement, the first projected rate increase of approximately 0.61 percent is expected to take effect in 2017. The annual rate increase amounts from 2017 through 2023 are projected to vary by year, ranging from 0.61 percent to 0.88 percent annually.
This page will be updated based on future developments.