Duke Energy proposes merger in the Carolinas amid controversy over rate increases
Published 11:39 am Friday, August 29, 2025
Duke Energy has proposed a plan in August to merge its two subsidiary utilities operating in the Carolinas, a move the company says will ultimately save customers money. However, this announcement comes at the same time as requests for new rate increases across the state, raising concerns among customers, advocates and public officials.
On August 14, Duke Energy filed with regulators in North and South Carolina to combine Duke Energy Carolinas, which serves Western North Carolina, the Charlotte region and parts of South Carolina, with Duke Energy Progress, covering a vast 29,000 square miles in central and eastern North Carolina and northeastern South Carolina. Notably, this merger proposal stands apart from pending rate increase requests currently under review.
Duke Energy claims that merging its Carolinas subsidiaries will streamline operations and reduce costs. The company projects that efficiency improvements could lead to customer savings exceeding $1 billion by 2038, with potentially greater efficiencies anticipated thereafter.
The merger is designed to take effect on January 1, 2027, contingent upon receiving approval from both state and federal regulators. While the company asserts that the merger will not result in immediate changes to retail customer rates or services upon its completion, future rate cases after 2027 are expected to gradually blend the rates of the two utilities.
This merger coincides with significant rate increase requests across the Carolinas. In North Carolina, Duke Energy Progress is anticipated to file for a new rate hike in late 2025, followed by Duke Energy Carolinas in early 2026. Additionally, Duke Energy Carolinas customers have already experienced rate increases starting January 1 of this year, as part of a three-year plan initially approved in late 2023.
In South Carolina, proposed base rate increases could result in residential bill hikes of approximately 12% for Duke Energy Carolinas customers and about 15% for Duke Energy Progress customers, if approved.
Duke Energy has consistently projected that its mergers would lead to significant customer savings, citing efficiencies gained from combining operations, yet promised savings have rarely materialized in lower bills. Historical examples illustrate this disparity, such as the 2012 merger with Progress Energy, where Duke claimed over $1 billion in cumulative savings from joint operations; however, customer rates continued to rise, burdened by operational costs and infrastructure investments. Similarly, after acquiring Piedmont Natural Gas in 2016, Duke promised $10 million in short-term gas bill savings, but this did not translate into sustained lower costs, as regulators continued to address larger rate increase requests.
Duke Energy attributes the increasing demand for energy and higher rates primarily to population growth. Advocates highlight the surge in energy-intensive data centers as the most significant factor driving this demand.