Agenda Package - 11-19-12 Reg. Meeting

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i3 5 r John Crumpton From: Buterbaugh, Quinetta <Quinetta.Buterbaugh @pgnmail.com> on behalf of McNeill, David <david.mcneill @pgnmail.com> Sent: Friday, October 12, 2012 4:52 PM Subject: Progress Energy Carolinas files for rate increase in North Carolina I just wanted to make you aware that today Progress Energy Carolinas filed a request with the N.C. Utilities Commission to increase annual base revenues by approximately $387 million. A corresponding change in the portion of retail rates that pays for energy- efficiency and demand -side management programs would reduce the revenue request to $359 million per year, or an average increase of approximately 11 percent for customers. The proposed rate increase reflects an investment of around $2.3 billion for plant modernization and other capital additions, including the facilities used to produce and deliver electricity to 1.3 million households and businesses in North Carolina. We are retiring our older, less- efficient coal plants that do not have the state -of- the -art emissions control technologies, and replacing them with cleaner, natural gas - fueled plants. Progress Energy Carolinas has invested more than $1.3 billion dollars to complete natural gas - fueled units at the Smith Energy Complex and in Wayne County, with an additional unit under construction at our Sutton Plant. We are also making important investments in our nuclear fleet to enhance the multiple layers of safety, security and operational protection in place at our plants in North Carolina. Approximately 84 percent of the requested rate increase reflects these investments made to modernize our system, as well as the costs associated with ensuring safe, reliable and increasingly clean electric service today, and for generations to come. The following chart illustrates the Customer Residential ro osed net rate increases by customer type: 14.3 percent N.C. Small General Service 11.6 percent N.C. Medium General Service 9.9 percent N.C. Large General Service 5.9 percent Lighting 4.3 percent This table shows the average impact of the proposed changes for each customer class. The specific increase or decrease for individual customers will vary depending on the rate they pay and other factors. It is important to note that if the rate increase is approved, the company's rates would remain below the national average. It has been 25 years since Progress Energy Carolinas last filed for a base rate increase. We know there is never a good time to seek a rate increase, and we have worked hard to maintain rate stability while providing excellent service to our customers. We are focused on managing our business and keeping rates as low as possible. And the recent merger between Progress Energy and Duke Energy, while not a driver in the decision to file a rate case, will produce additional savings through the merging of our operations and workforces that are expected to reduce the impact of future price increases. For more information Progress Energy Carolinas has a package of energy- efficiency products and services to help customers lower overall energy costs. Visit this site to learn more.