What if Duke Energy Shared the Burden of Fuel Costs with Its Customers?

Why It Matters

Shifting fuel‑cost risk to shareholders could curb bill spikes and accelerate Duke’s transition to renewable energy, benefiting both consumers and the climate agenda.

Key Takeaways

• North Carolina customers faced 45% utility bill rise since 2020.
• Fuel costs comprised 67% of rate hikes in central NC.
• RMI model predicts $100M consumer savings with 10% cost sharing.
• Policy could incentivize Duke to shift toward renewables.

Pulse Analysis

Fuel‑cost sharing is gaining traction as a tool to protect consumers from the wild swings of global fossil‑fuel markets. In North Carolina, where Duke Energy supplies roughly 3.8 million customers, the practice would require the utility’s shareholders to cover a set percentage of any fuel‑cost overruns, while allowing them to reap a share of savings when prices dip. By internalizing part of the risk, utilities gain a financial motive to curb reliance on natural‑gas plants and invest in wind, solar and battery storage, aligning corporate incentives with public demand for lower, more predictable bills.

The economic case for the policy is compelling. Rocky Mountain Institute’s analysis of a 10% sharing scheme estimates that customers could have saved $100 million over 2021‑2023, a tangible relief amid a 45% average bill increase since 2020. Investors would have earned modest upside—about $10 million in the same period—demonstrating a win‑win scenario. Moreover, fuel‑cost sharing could accelerate the retirement of gas‑fired generation, reducing emissions and supporting state clean‑energy goals without requiring direct subsidies.

Despite its promise, the proposal faces political and regulatory headwinds. North Carolina’s utility commission has claimed limited authority to mandate a cost‑sharing study, and the Republican‑controlled legislature remains cautious about imposing new obligations on a dominant utility. Proponents plan to embed the issue in upcoming rate‑case hearings and legislative sessions, hoping that mounting consumer pressure—evidenced by a 73,000‑signature petition—will tip the balance. If adopted, the model could serve as a template for other states wrestling with fuel‑price volatility and the transition to a low‑carbon grid.