Duke Energy said on 7 October that its North Carolina utilities had reached a settlement requiring qualifying new data centres to pay upfront for grid connections, extending protections it introduced for customers of 100 megawatts or more in 2024 to some customers of 50 megawatts or more. Amazon, Google, Meta and Microsoft are parties to the agreement, which needs approval from the North Carolina Utilities Commission.
Key points
- Duke Energy says customers would make nonrefundable upfront payments for grid facilities built solely for them, and provide deposits and security guarantees for shared upgrades.
- The proposed terms cover large-load customers of at least 50 megawatts with an 80% load factor that sign a North Carolina electricity service agreement after 1 June 2026.
- Attorney General Jeff Jackson separately asked regulators for a dedicated data centre rate class and more frequent Duke Energy demand forecasts.
Duke Energy divides connection and shared-grid costs
The settlement involves Duke Energy Carolinas and Duke Energy Progress, alongside North Carolina Public Staff, the agency representing utility customers. Duke Energy also names Amazon, Google, Meta, Microsoft and Carolina Industrial Group for Fair Utility Rates among the parties. Their participation puts large technology companies directly into an agreement on how new electricity customers pay for grid work.
Under the proposed terms, a customer would make a nonrefundable payment upfront for facilities serving only its site, Duke Energy says. A substation connecting that customer to the grid is the company’s example. Upgrades used by other customers, including transmission lines, would instead require upfront deposits and security guarantees from the new large-load customer.
Duke Energy says new large-load customers, including data centres, would also take service under its High Load Factor rate schedule, a separate rate for large loads. The payments, deposits and guarantees address grid construction, while the rate schedule governs the electricity service those customers receive.
The company says the settlement builds on contract protections it began requiring in 2024 for data centres and other loads of at least 100 megawatts. If regulators approve it, the new threshold would be 50 megawatts or more with an 80% load factor, provided the customer signed an electric service agreement in North Carolina after 1 June 2026. Duke Energy says agreements signed before that date contain similar customer protections.
Jackson seeks a separate data centre rate class
North Carolina Attorney General Jeff Jackson argued in a separate filing on 6 October that data centres using Duke Energy should have their own rate class and be allowed to supply their own clean energy, WITN reported. His proposal addresses the tariff applied to data centres, rather than the settlement’s requirement for upfront payments on facilities serving individual customers.
Jackson also urged the Utilities Commission to require Duke Energy to publish its standard data centre contracts and update its load forecasts every 90 days instead of every six months, WCCB Charlotte reported. WITN reported that, according to a press release, Duke Energy expects data centres and other large energy users to account for more than 80% of its new energy demand.
Jackson and North Carolina Governor Josh Stein had challenged Duke Energy in July to make its commitment under a federal Ratepayer Protection Pledge legally binding, WITN reported. Duke Energy announced its Customer Protection Plus framework that month and said data centre growth would bring billions of dollars in future benefits to existing customers. The company says the proposed settlement adds terms addressing concerns raised by regulators and customers.
North Carolina commission to review Duke settlement
Duke Energy Carolinas serves about 2.3 million households and businesses in central and western North Carolina, while Duke Energy Progress serves about 1.6 million customers in central and eastern areas and the Asheville region, the company says. The utilities are due to combine on 1 January 2027. The North Carolina Utilities Commission is expected to decide on the settlement by mid-November, according to Duke Energy.
