With Duke Energy Carolinas’ proposal in July to increase electricity rates, it’s important to look at how those rates are determined and what role the Public Service Commission of South Carolina plays in setting those rates.
PSC’s role
The Public Service Commission is charged under state law with establishing rates for services provided by electric, natural gas, water and wastewater utilities in the Palmetto State.
The commission’s mission statement targets “just and reasonable” rates which require the commission to weigh the impact of those rates on utility customers against the expectation of public utility providers to receive a return on their investment.
Because the commission has judicial functions in determining utility rates, it collects a variety of information and testimony from utilities, rate payers and other interested parties as part of its process for evaluating and setting rates.
As part of its efforts to represent the interests of the state’s utility customers and keep them informed, the commission maintains the South Carolina Utility Consumer website. Through the site, consumers can access documents related to a rate application and keep abreast of scheduled events like public hearings as the commission evaluates an application. The site also provides consumers with instructions on how to file a letter of protest regarding a matter before the commission.
According to PSC’s website, the commission is under no obligation to guarantee a utility’s profitability but does recognize such companies’ need to earn a “reasonable” return on investments in things like infrastructure related to providing a service.
In the case of Duke Energy Carolinas’ application for a rate increase, the company argues the roughly $150.5 million in additional revenue is needed to recoup transmission and distribution investments aimed at improving electric grid reliability and resiliency.
Duke serves about 680,000 customers in South Carolina and last requested an 8.7% rate increase in January 2024, which PSC approved and went into effect in August 2024.
The commission conducted public hearings in the Upstate earlier this month on the utility’s latest rate request and is expected to conclude hearings in Columbia in November.
For more information about the Public Service Commission of South Carolina, visit psc.sc.gov. For information specific to Duke Energy Carolinas’ rate application, visit duke-energy.com/home/billing/dec-sc-rates.
