VICTORY: The IURC said NO to Duke Energy smart meters and more rate hikes!
Duke Energy's request for a $1.87 BILLION rate increase was denied by the IURC on 5/8/15!
Duke Energy filed a request with the Indiana Utility Regulatory Commission to raise your rates $1.87B to pay for a long term transmission and distribution plan. The plan was filed as a result of SEA560 which passed the Indiana General Assembly in 2013.
Duke claimed that the plan would increase rates an average of 1% every year from 2016-2022.
- The average monthly electric bill of Duke Energy customers has already increased by almost 10% in the last year alone and nearly 56% in the last ten years.
- Additionally, since 2009 Duke Energy has collected in excess of $600 Million from ratepayers for the Edwardsport IGCC coal gasification boondoggle with billions left to collect in future years.
Ratepayers can’t afford any more increases!
Approximately 30% of Duke’s bills are comprised of trackers. Trackers allow utilities to raise rates when costs go up in some areas while never having to lower rates when costs go down in other areas. They already have 10 approved trackers. They don’t need another one!
If the IURC had approved this request, Duke Energy would have been given yet another tracker that would have allowed them to essentially raise your rates automatically. If approved, this particular tracker would have given them excessive profit to do something they are supposed to be doing anyway: provide reliable electric service.
Most of the projects included in the $1.87B proposal by Duke Energy were investments Duke is required to make to meet their legal obligation of providing reliable electricity to their captive customers. This particular tracker would have shifted the burden of cost and risk of running a monopoly utility company from voluntary investors to captive ratepayers. As a result, the utility's guaranteed rate of return should have been reduced to reflect the reduction in risk.
However, Duke Energy was asking to collect their full authorized ROE of 10.5% even though ratepayers would have been assuming all of the risk. Outrageous! Profit is supposed to be the reward for risk. Duke admits that if this had been approved, this tracker would have reduced their cost of capital, further minimizing any risk to the company.
If ratepayers are forced to assume the risk, then ratepayers should realize some of that profit.
Duke’s petition also included a $177 million request to install expensive, invasive, and unnecessary smart meters in every home and business in their Indiana service territory. To add insult to injury, they wanted to continue to earn a return on the investment for the old meters they were proposing to remove while simultaneously recovering the costs (plus a rate of return) of the new smart meters! Unacceptable.
Duke should not be allowed double recovery!
Smart meters should not be mandatory. Duke should be required to offer the smart meters to customers as a voluntary option. Ratepayers should not be forced to pay for a smart meter they don’t need and they don’t want. The costs of smart meters far outweigh the benefits. Most of the purported benefits of smart meters are benefits for the utility. Therefore, they should bear some of the costs and risks associated with the meters.
Lastly, many concerns have been expressed about privacy and cyber security related to the installation and utilization of smart meters. All of these concerns must be addressed prior to any approval for a smart meter rollout.