INDIANAPOLIS – A rate increase for Duke Energy was approved Monday at a much lower rate than requested by the Indiana utility company.
Following a year-long review of Duke Energy Indiana, LLC’s base rate case, The Indiana Utility Regulatory Commission lowered the requested amount by approximately 60 percent.
The order signed Monday authorized an additional annual revenue of approximately $146 million.
“This is a significant reduction from both the utility’s original request of $395 million and its later revised request of $362 million,” according to an IURC press release.
Duke Energy last increased its based rate in May 2004.
The ncrease will be implemented in two phases.
In its decision, the commission implemented various rate mitigation measures to reduce the impact of Duke’s proposed rate increase on Duke customers, such as lowering the utility authorized return on equity (ROE) from the Duke-requested 10.40 percent to 9.70 percent and changing the investment recovery methodology to reduce the near term impact of Duke’s recent investments on customers.
The Commission also denied the utility’s request to implement an electric decoupling mechanism, which would have separated fixed costs from sales volume for residential and small commercial customers, stating that the proposal is “not in the public interest because it would allow the Company to recover revenues for reductions in energy consumption that were not caused by its conservation efforts.”
On the same day, the IURC denied a request by Duke Energy, Vectren and other Indiana utilities to increase rates to offset lost revenue caused by the global coronavirus pandemic.