Duke Energy Carolinas, LLC - FORM 8-K - EX-99.1 - July 1, 2011

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Exhibit 99.1

 

Duke Energy Carolinas

Summary of Rate Case Filing in North Carolina

Docket E-7, Sub 989

 

Major Components of Filing

 

·                  On July 1, 2011, Duke Energy Carolinas filed a rate case with the North Carolina Utilities Commission (NCUC) to request an average 15 percent increase in retail revenues, or approximately $646 million:

 

·                  The rate case filing requests an overall rate of return of 8.64% based on approval of an 11.5% return on equity and a 53% equity component of the capital structure

 

·                  The filing is based on a North Carolina retail rate base of $11.2 billion as of December 31, 2010 and adjusted for known and measurable changes (hearings are expected to commence in November 2011)

 

·                  This rate increase request is driven by:

 

Drivers

 

Revenue
Requirement

 

% of Total
Request

Capital investments of $4.8 billion* for plant modernization, environmental compliance and other capital additions (see additional information below)

 

~$480 million

 

~74%

Effects of the continued weak economy, which have resulted in lower weather-normalized sales volumes and lower Bulk Power Marketing (BPM) profits than the level currently included in base rates

 

~$68 million

 

~11%

Changes in financing and other general costs, including the request to increase the allowed return on equity from 10.7% to 11.5%

 

~$98 million

 

~15%

 

·                  Capital investments of $4.8 billion* since the 2009 rate case, including pro-forma adjustments to reflect known and measurable changes include:

 

·                  Cliffside 5 Scrubber - $565 million

 

·                  Cliffside Unit 6 Construction Work in Progress - $640 million incremental investment compared to approximately $1 billion already included in base rates

 

·                  Buck Combined Cycle Project - $700 million

 

·                  Bridgewater Powerhouse Replacement - $180 million

 

·                  Oconee Nuclear Upgrades - $135 million

 

·                  Transmission and Distribution - $1 billion

 

·                  Nuclear Fuel - $210 million

 

·                  Capital maintenance and other general projects - $1.4 billion

 

·                  If approved by the NCUC, rates would likely go in effect in February 2012

 

* Represents DE Carolinas in total; NC allocable portion is ~70%

 

7/1/2011