Regulated versus deregulated … What you should know

Charging a phone, turning on a light switch and watching TV are things we do every day without much thought. Electricity enables us to do these things but because it is “invisible,” many don’t understand how it is generated, what it costs and how it is delivered to our homes. Throw in terms like “regulated” and “deregulated” and it can be even more confusing.

What does it mean?

A “regulated energy market” is where a utility company owns the electric transmission lines and all associated infrastructure (like power poles, power lines and transformers), and generates (makes) or purchases electricity and sells it to customers. Utility companies have to show a return on investment or a benefit for the money they spend.

A “deregulated energy market” is where utility companies continue to own and maintain the transmission infrastructure and distribute electricity, but other companies can compete in that area to supply and sell electricity to customers. Deregulation is focused on competition, and future generation decisions are based on how to best manage risk and earn income.

What does this mean for Duke Energy’s nuclear fleet?

The Carolinas are a regulated energy market. As a regulated utility, Duke Energy must abide by the rates set by state public utility commissions. Only costs the commission deems to be reasonable and prudent may be charged to customers. The commission also conducts annual reviews, which include input from many stakeholders, including customers and consumer advocates.

What does that mean for our customers? Regulated energy markets are sometimes called a “monopoly.” This simply means we must provide customers with 24/7 access to reliable electricity. Energy markets value clean energy and, in the Carolinas, we have a market that sees the value of nuclear and its clean, reliable attributes. Among the benefits of regulated markets are fair and more stable prices, greater state/local control, and much greater long-term certainty. 

We don’t pick which energy sources are used to provide electricity based solely on the bottom line, but incorporate what is in the best interest of our customers. We are proud to generate electricity with nuclear energy – carbon-free, always-on, reliable energy to power the Carolinas. That way our phones stay charged and we can binge watch our favorite shows without interruption. 

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