Duke Energy 8-K

Summary

North Carolina rate-case settlement. Duke Energy Carolinas (DEC) and intervenors agreed on the remaining revenue requirement issues in DEC’s rate case, subject to approval by the North Carolina Utilities Commission (NCUC). The settlement sets a lower revenue requirement than DEC’s latest request and includes an annual refund mechanism for the multi-year rate plan.

Key Figures

• Revenue requirement increase: $496M over two years, down from DEC’s revised $556M request; the initial request was $1.002B. The settlement’s net annualized customer rate increase is 7.4% combined, including 4.3% for Year 1 and 3.1% for Year 2; the filing describes the average annual increase over two years as 3.7%.
• Return on equity: 9.8% with a 53% equity component in the capital structure, versus DEC’s revised request of 10.48%. Historic North Carolina retail rate base: ≈$25.7B, versus ≈$26.5B in the initial filing.
• Multi-year rate plan: ≈$3.8B of North Carolina retail-allocated capital, down from ≈$4.4B in the initial filing, with annual refunds based on projects and capital placed in service versus approved amounts.
• One-time pre-tax accounting charges: ≈$40M, expected to be recognized in 2026 and excluded from adjusted earnings. DEC also agreed to a $10M shareholder contribution for bill assistance and home health and safety repairs.

Investor Takeaways

• NCUC approval is the key next step; subject to approval, DEC requested Year 1 rates take effect no later than 1/1/2027.
• The parties also agreed to pursue good-faith discussions on a substantially similar settlement framework in Duke Energy Progress’s ongoing rate case.