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South Carolina rejects Duke Energy fee hike after “What the Fee?!” outcry

Consumer Reports commends SC public service commission for defending consumer access to affordable electricity

Thanks to a large public outcry by South Carolinians, Duke Energy’s request to dramatically increase fixed fees for their utility customers was not only rebuked, but backfired.

The state’s public service commission firmly rejected Duke Energy’s request for a 238 percent increase in mandatory fixed fees, instead setting it five times lower than Duke’s proposal, in addition to disallowing cost recovery for a cancelled nuclear project and other exorbitant costs, and even cutting a portion of the CEO’s compensation package.

“We applaud the Commission for listening to ratepayers and standing up to unfair fee hikes,” says Shannon Baker-Branstetter, manager of cars and energy policy for Consumer Reports. “This should send a message to utilities across the country that, if you try to hit your ratepayers with huge fee increases to cover failed investments, it can backfire, especially when your CEO is making more than $20 million a year.”

Duke Energy Carolinas (DEC) was requesting to triple its mandatory fixed fees, known as a ‘Basic Facilities Charge,’ to the highest in the nation for any investor-owned utility. Since Duke Energy has a monopoly on access to electricity for parts of South Carolina, rate and fee changes must be approved by South Carolina’s Public Service Commission.

Had the request been approved, it would have meant DEC customers, currently charged $8.29 per month just for access to electricity, would be charged $28 per month before even turning on the lights; that comes out to $336 per year just for the right to use electricity.

The Greenwood, S.C. newspaper Index-Journal reported commissioner Thomas Ervin’s summary of the commission’s unanimous decision: “What concerned the ratepayers who testified, and what concerned the commission, frankly, was the fact that the CEO, Lynn Good and her executive team demonstrated that they really were tone-deaf as to how a 238 percent increase in the South Carolina Basic Facilities Charge would negatively and adversely impact the elderly, the disabled, the low-income and low use customers who are being served by the company.”

The decision applies to Duke Energy Carolinas, which services several communities including Greenville, Anderson, Spartanburg. South Carolina’s Public Service Commission is also weighing a similar fee increase request by Duke Energy Progress (DEP), which services Florence and Sumter. The Commission’s decision for the DEP service area is expected in the coming weeks.

Consumer Reports joined a coalition of public interest organizations in speaking out against both fee hike requests, and mobilized Duke Energy customers to explain to the commission how the fee hike would impact their finances. Over 500 people signed on to a CR petition that was delivered to the commission, and  CR recruited members in South Carolina to attend commission hearings. CR also placed an opinion editorial in the Sumter Item newspaper to educate Duke customers about the proposal and what actions they could take to voice their concerns.

Consumer Reports advocates against hidden and inequitable fees not just by utilities, but airlines, cable companies, and other parts of the U.S. marketplace. To learn more about Consumer Reports’ “What The Fee?!” campaign, visit WhatTheFee.com.

You can learn more about the recently-rejected request made by Duke Energy by going to CR.org/truthaboutduke.

 

For media inquiries, please contact: Adam Winer, Communications Associate, Adam.Winer@Consumer.org, (202) 238-7444.

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