This year, Duke seeks a $492 million revenue increase. Members of the public are giving testimony to state regulators against its proposal.
(WFIU/WTIU)
She’s a single parent raising five kids as a paraprofessional at Templeton Elementary. Carey’s also in school to become a licensed teacher.
Her electric bill last month was $237.88. She already has to make tough choices to provide for her family but said a rate increase could push them closer to the edge.
“I try to budget anyway, but it'll be a lot of sacrifices that would need to be made,” Carey said. “Having five kiddos, they eat a lot, you know? So it’ll be more so making sure they are getting their needs and not their wants. It’d have to be a lot more strict on that.”
Eliza Carey (right) shows her $238 electric bill from last month. She's raising five kids by herself and worries what she'll do if those costs go up even higher. (Lucinda Larnach/WTIU)
She’s already taking advantage of Duke’s interest-free payment plan but still she’s struggling to stay afloat. Carey asks her kids to keep the lights off during the day to save power.
“I'm to the point now where I'm cutting my power off completely from the circuit breaker and just leaving my fridge on during the day,” she said.
If Carey can no longer make payments, she could be disconnected from the grid. Indiana is one of 31 states in which utility companies can shut off electricity during a heat wave.
Kerwin Olson, Executive Director at the Citizens Action Coalition, explained that rule is part of a regulatory compact made between the state and utilities in exchange for a virtual monopoly in certain communities.
“The idea being these regulatory agencies are a surrogate to competition, it's an uncompetitive marketplace,” Olson said.
Kerwin Olson's group, the Citizens Action Coalition, is an intervenor against Duke in the IURC's rate hike case. (Max Rebolledo/WTIU)
Duke said it will use that money to cover grid upgrades, replacing wood poles with steel that can better withstand storms and expanding power lines to the additional 60,000 customers it expects by 2025. It’s also planning to install sensors that identify outages more quickly.
“We know that utility costs can be a major part of the household budget,” said Angeline Protogere, a spokesperson for Duke Energy. “That's one reason why since 2020, we've held the line on day-to-day operating costs, while we've made investments of $1.6 billion in improvements to our system.”
Any increase is supposed to cover maintenance costs and improvements, but the utility can also earn profits up to an amount agreed on by the Commission.
This year, Duke seeks a $492 million revenue increase. That includes raising the return on equity from 9.7 to 10.5 percent. Last year Duke made a $497 million profit in Indiana.
“We can use that, for instance, for dividends to pay our shareholders,” Protogere said. “That return is regulated, it's not guaranteed.”
The rate increase will roll out over two years if passed.
The Coalition’s estimate looks at current bills, while Duke’s figures include its predictions for changing trackers, which are parts of the power bill outside of the base rate like fuel costs. Adjustments to trackers are not part of the proposal.
“All we are doing is saying, ‘Here's your bill today, your total bill trackers included. Here's what Duke Energy Indiana wants your bill to be,’” Olson said.
Other Duke customers spoke up Thursday at a hearing with the IURC at the Monroe Convention Center. Almost 60 signed up to give testimony to be entered on the record. Representatives from the IURC, Office of the Utility Consumer Counselor, Duke and the Citizens Action Coalition sat by and listened.
Residents got emotional at a Thursday hearing with the IURC in the Monroe Convention Center. Many spoke against the rate hike proposal. (Ethan Sandweiss/WTIU)
Elected officials such as State Senator Shelli Yoder (D-Bloomington) and State Rep Matt Pierce (D-Bloomington) spoke against the proposal.
Pierce serves on the House Utilities, Energy and Telecommunications committee.
“I don't think it's justified to increase this profit margin for Duke, because they're still going to be able to get the equity they need,” he said. “It's a very low risk investment.”
Most of the testimony came from residents such as Matthew Schulz, who said he’s a single parent raising a 22-month-old.
“My son and I have been forced to live in the dark in 80 plus degree temperatures in an effort to make the current energy costs as affordable as possible,” he said.
Bloomington City Council Member Matt Flaherty cited research from IU’s Energy Justice Lab that showed Duke made over 25,000 disconnections last year.
“That can of course then turn into debt collections and other issues,” he told City Council. “Just highlighting that's the context through which we're very concerned about the potential impacts.”
The Council is asking for a modified proposal. It says Bloomington Mayor Kerry Thomson plans to add her signature early next week.
The IURC is taking written comments from the public until July 5th. After that, the rate case proceeds like a civil court case, with lawyers for Duke and interveners cross-examining technical witnesses. A regulatory decision is expected early next year.
