Providing reliable electricity at the lowest possible cost requires more than operating an industry-leading system with skilled and dedicated employees, and forecasting demand. We must know how existing and pending legislation, regulation and trends will affect costs and power supply, and advocate on your behalf for best outcomes. We thought you should know how the energy landscape is changing, and what we’ve been doing about it.

Legislation dictating that Duke Energy lower carbon emissions, along with the retirement of coal-fired plants, has promoted a new mix of generation assets. At the same time, we have increased power supply needs, locally and across the state. The costs associated with the necessary new infrastructure and generation build-out are significant. For background, as part of our statewide generation network, NCEMC, we currently own part of Catawba Nuclear Station, two peaking plants, and a combined-cycle plant, which uses natural gas and a steam turbine to produce 50% more electricity from the same fuel than a traditional plant.

Years ago, when we saw the change in the energy mix and increasing demand coming into focus, we redoubled our efforts to lower costs and put ourselves in the best possible position for negotiating contracts. Recently, despite inflationary pressure, in order to secure future capacity, we, through NCEMC, invested in another combined-cycle plant, Roxboro Unit One. For price stability, we’re hedged 90%, for three years, on the natural gas our existing generating plants use. We’re making smart decisions in dealing with increased power supply needs, although it does come with a cost.

We’re continually looking for deeper ways to find efficiencies, using data, setting targets, and monitoring metrics.

When we learned that an EPA ruling, which is still making its way through the courts, might cause us to run our new combined-cycle plant at a lower percentage of available capacity, we and NCEMC began defending our position. We’ve been active in the Intervenor process with the Utilities Commission, and with legislative efforts, to work toward a favorable outcome.

These are just a few of the ways we work to maintain reliability and cost stability. We haven’t had a rate increase in five years, even though we’ve had significant increases in the cost of materials, due to the strength of our team. They are experts in efficiencies, working in our warehouse, and in construction, logistics, power supply, energy solutions, and all aspects of the business. We’re continually looking for deeper ways to find efficiencies, using data, setting targets, and monitoring metrics.

Finally, thank you for your continued participation in programs and options like Connect to Save, Time-of-Use and Beat the Peak. They also make a valuable, important contribution to controlling costs, saving us more than $750,000 per year. The power of our collective action is the force behind everything we do, because we know that together, we can achieve better outcomes for us all. Rest assured, we are increasing our focus on the things we’ve always done well, and working hard to do them even better, with you in mind.