In late 2017, the U.S. government lowered the federal tax rate for corporations from 35 to 21 percent.
“As a result, individual households could see bill savings of up to approximately $70 over the course of one year,” Duke said in a release this week. “Customers who receive both electric and natural gas service from Duke Energy may see even higher savings.”
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“We’ve been working closely with state regulators to ensure that our customers enjoy immediate and long-term benefits of the tax act,” Amy Spiller, president of Duke Energy Ohio & Kentucky, said in the company’s announcement. “Since the act was passed, we’ve taken many voluntary and proactive steps to enable our customers to start saving money on their monthly energy bills.”
In early 2018, the Public Utilities Commission of Ohio (PUCO) sought to have state utilities pass on savings from the tax cut to their customers. Initially, companies resisted that idea.
Eventually, some utility operating plans approved by the PUCO included new rates that reflected the tax cuts.
Last month, the PUCO allowed Duke Energy Ohio to establish a credit on electric customer bills to reflect the tax cut.
“The commission is pleased to approve the reduction in bills for Duke’s electric customers,” PUCO Chairman Asim Haque, said in a PUCO statement in February. “The commission has been pursuing rate reductions from the day the (tax cut) went into effect, and today’s action settles the issue for three out of four of Ohio’s regulated-electric utilities, while the fourth is in the settlement process.”
Dayton Power & Light’s distribution rate plan approved by the state last year also reflects the tax cut, regulators said.
Duke will credit customers the amount it has over-collected, plus interest, since Jan. 1, 2018 under the high tax rate, the company said. The $8.1 million credit will be passed back to all electric customers over a 12-month period, Duke said.
Compared to 2017, a typical residential electric customer in Ohio saved about $13 on electric charges in 2018 due to the tax act – and can expect to save about $40 in 2019, Duke said.