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Duke Energy's (DUK) Arm to Implement New Rates in North Carolina
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Duke Energy Corp. (DUK - Free Report) recently announced that its subsidiary — Duke Energy Progress — is going to implement new rates for North Carolina customers, from Jun 1, following the approval from the North Carolina Utilities Commission (NCUC).
The company’s new rates include state and federal tax savings for customers and will remain below the national average.
A Detailed Note on New Rates Implementation
Courtesy of the approval from NCUC, Duke Energy Progress will increase its electric rates by an average of 4.7% across all customer groups, from Jun 1. Over the next couple of years, the annualized bill for a typical residential customer, using 1,000 kilowatt-hours (kWh) of electricity per month in North Carolina, will increase to $119.83 from the current $113.53.
To summarize, the average rate increase will be 5.3% for residential customers, 4.7% for commercial customers and 3.6% for industrial customers.
How Will This Benefit Duke Energy?
The recent approval by the NCUC for a rate increase in North Carolina will be instrumental for Duke Energy to recover costs of investment and thereby, expand its operations and provide better services. As Duke Energy Progress serves 1.4 million households and businesses in central and eastern North Carolina and in the Asheville region, implementing the rate hike will likely boost its earnings growth.
Notably, the company’s robust five-year capital plan and current plans of investing more than $29 billion in electric utilities and infrastructural growth projects over the 2021-2023 timeframe support this step. We believe such rate increases, which in turn lead to notable earnings growth, will allow the company to duly achieve its long-term investment targets.
Utilities & Rate Hikes
Utilities follow a systematic strategy of rate hikes, which has historically boosted their results.
Recently, in May, NiSource Inc.’s (NI - Free Report) subsidiary, Columbia Gas of Maryland, filed a rate revision request with the Maryland Public Service Commission (PSC). If approved, the average total bill for the unit’s residential customers who consume 70 therms of gas per month will increase 11.35%
In April, American Water Works Company (AWK - Free Report) announced that its subsidiary Missouri American Water has received approval from the Missouri Public Service Commission to increase water and wastewater rates from May 2021. The rate revision will take into consideration nearly $620 million invested by the company since 2017-end to improve the quality of water and wastewater services.
On Mar 1, 2021, CMS Energy's (CMS - Free Report) subsidiary, Consumers Energy, filed a request for a $225-million application with the Michigan Public Service Commission seeking an increase in its electric generation and distribution rates based on a test year ending December 2022.
In a year’s time, shares of Duke Energy have increased 16.8% compared with the industry’s 6.5% growth.
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
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Duke Energy's (DUK) Arm to Implement New Rates in North Carolina
Duke Energy Corp. (DUK - Free Report) recently announced that its subsidiary — Duke Energy Progress — is going to implement new rates for North Carolina customers, from Jun 1, following the approval from the North Carolina Utilities Commission (NCUC).
The company’s new rates include state and federal tax savings for customers and will remain below the national average.
A Detailed Note on New Rates Implementation
Courtesy of the approval from NCUC, Duke Energy Progress will increase its electric rates by an average of 4.7% across all customer groups, from Jun 1. Over the next couple of years, the annualized bill for a typical residential customer, using 1,000 kilowatt-hours (kWh) of electricity per month in North Carolina, will increase to $119.83 from the current $113.53.
To summarize, the average rate increase will be 5.3% for residential customers, 4.7% for commercial customers and 3.6% for industrial customers.
How Will This Benefit Duke Energy?
The recent approval by the NCUC for a rate increase in North Carolina will be instrumental for Duke Energy to recover costs of investment and thereby, expand its operations and provide better services. As Duke Energy Progress serves 1.4 million households and businesses in central and eastern North Carolina and in the Asheville region, implementing the rate hike will likely boost its earnings growth.
Notably, the company’s robust five-year capital plan and current plans of investing more than $29 billion in electric utilities and infrastructural growth projects over the 2021-2023 timeframe support this step. We believe such rate increases, which in turn lead to notable earnings growth, will allow the company to duly achieve its long-term investment targets.
Utilities & Rate Hikes
Utilities follow a systematic strategy of rate hikes, which has historically boosted their results.
Recently, in May, NiSource Inc.’s (NI - Free Report) subsidiary, Columbia Gas of Maryland, filed a rate revision request with the Maryland Public Service Commission (PSC). If approved, the average total bill for the unit’s residential customers who consume 70 therms of gas per month will increase 11.35%
In April, American Water Works Company (AWK - Free Report) announced that its subsidiary Missouri American Water has received approval from the Missouri Public Service Commission to increase water and wastewater rates from May 2021. The rate revision will take into consideration nearly $620 million invested by the company since 2017-end to improve the quality of water and wastewater services.
On Mar 1, 2021, CMS Energy's (CMS - Free Report) subsidiary, Consumers Energy, filed a request for a $225-million application with the Michigan Public Service Commission seeking an increase in its electric generation and distribution rates based on a test year ending December 2022.
Zacks Rank & Price Movement
Duke Energy currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
In a year’s time, shares of Duke Energy have increased 16.8% compared with the industry’s 6.5% growth.
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
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