Nearly 46,000 low-income Duke Energy customers could soon face a double hit: losing a monthly bill credit while paying higher electric rates.
That possibility took center stage Tuesday as North Carolina regulators questioned Duke executives about affordability during a hearing on the utility's proposed rate increase.
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The company's Customer Assistance Program provides eligible households with up to a $42 monthly credit on their electric bills. Unless it's extended, the pilot program expires Dec. 31. At the same time, Duke is asking regulators to approve a rate increase that would add about $10 a month to the bill of a typical residential customer in the first year.
During the hearing, Commissioner Jeff Hughes McKissick asked whether customers receiving the credit could effectively see their monthly costs jump by about $52 if both happen at once.
"That would be the effect," Duke executive Kendal Bowman responded, adding the company would notify customers and connect them with other assistance programs if the pilot ends.
The exchange captured the central question in Duke's rate case: How much more can customers afford to pay?
Bowman testified that about 20% of Duke's residential customers are at least one day past due on their electric bills. She said Duke still must invest in the electric grid to keep pace with North Carolina's growth and maintain reliable service.
"We have to make investments to keep the lights on," Bowman testified.
Duke says North Carolina is entering an unprecedented period of electricity demand driven by rapid population growth and large industrial customers, particularly data centers. In an April filing, Duke reported the number of large electric load projects with signed service agreements had nearly doubled over the past year, growing from nine to 16 projects representing more than 4.3 gigawatts of demand. Overall, Duke says it is planning for 43 advanced large-load projects totaling nearly 8 gigawatts.
The surge has raised concerns that residential customers could end up paying for infrastructure needed to serve energy-hungry data centers. For months, consumer advocates, Attorney General Jeff Jackson and the governor's Energy Policy Council have urged Duke to adopt special rates for large customers so they bear more of the costs they create.
Duke has since proposed a large-load tariff intended to require major new customers, including data centers, to pay the incremental costs of serving them.
The company also defended its decision not to propose new affordability programs in this case, saying it already offers payment assistance, energy efficiency programs and other resources for customers.
Bowman said the assistance pilot has helped participating households but comes at a cost to all customers, who fund the program through a charge on their electric bills. Duke testified the program has cost about $33 million through the end of 2025.
The company has already softened part of its request after months of public criticism.
Duke reduced its requested profit margin, known as return on equity, from 10.95% to 10.45%. Bowman called the move unprecedented in her 27 years with the company, saying it came after hearing concerns from customers about affordability.
Duke and the Public Staff, the state agency representing utility customers, have also reached a partial settlement that removes or delays several costs originally included in the case, including scaling back executive compensation charged to customers, delaying some capital projects and extending the repayment period for coal ash costs.
The Utilities Commission is expected to continue hearing testimony before deciding later this year whether to approve the company's request.