Duke Energy customers in Indiana are getting a break on their summer electric bills, and they can expect additional savings through the end of the year due to lower fuel costs.
Rates for the average residential customer have declined about 8 percent compared to last July, in large part due to lower coal costs. That amounts to about $10 in savings on a monthly bill for a customer using 1,000 kilowatt-hours.
Costs in 2015 are also lower because extreme winter weather in 2014 drove up fuel and purchased power costs.
Rates for more energy-intensive customers, businesses that use large amounts of power, have declined about 9 to 10 percent compared to last summer.
Costs will reduce further over the next few months as lower-cost fuel replaces higher-cost supplies. Those additional savings, if approved by the Indiana Utility Regulatory Commission in a filing made today, would amount to $2 monthly for an average residential customer during October, November and December. Some of the savings are also due to a true-up of previous cost projections.
“A large part of the decreases is due to a settlement with one of our large coal suppliers, which means reduced fuel costs to produce electricity—savings that we pass along to customers,” said Duke Energy Indiana President Melody Birmingham-Byrd. “These are significant rate decreases that will help our customers, especially industries and large businesses, reduce and control their costs, particularly during the summer when customers use more power and bills are higher.”
Indiana state utility regulators review utility fuel costs four times a year, and costs fluctuate, but a significant part of these decreases are due to lower pricing for a long-term coal contract. Fuel costs are one of the largest components of a customer’s bill.
The Indiana Utility Regulatory Commission first approved a portion of the decreases in late March as part of the company’s quarterly fuel clause filing. Lower costs began appearing in customer bills in April.
Duke Energy Indiana’s operations provide about 7,500 megawatts of owned electric capacity to approximately 810,000 customers in a 23,000-square-mile service area, making it the state’s largest electric supplier.