Crist changes to utility regulation scaring investors, expert says
by Dara Kam | September 16th, 2009Gov. Charlie Crist’s recent threats not to reappoint two Public Service Commissioners if they vote for a proposed $1.3 billion Florida Power & Light Co. rate hike could scare investors away from investing in the utility, an expert testified today.
Bill Avera, a financial analyst hired by FPL, said that the regulatory climate in Florida had changed under Crist and that credit rating agencies, including Moody’s and Fitch, were paying attention.
“The governor cautioned this commission to regard carefully the outcome of this case and even suggested that the tenure of the reappointment of some of the commissioners might be in question based on the outcome of this case. That is unusual. That is the kind of political change that rating agencies are very concerned about,” Avera told the panel during a marathon hearing slated to last 12 hours today.
Opponents of the rate hike grilled Avera throughout the day but those comments temporarily quieted attorney Sheffel Wright.
“Surely you don’t think that Gov. Crist wants the commission to do anything that would render FPL unable to cover its debt service?” Wright asked after a long pause.
“It doesn’t matter what I think,” replied Avera. What matters is what the credit rating agencies believe, he said.
“I think investors see this as a change in posture in Florida. The long tradition in Florida is one where the commission has been free to exercise its expertise in making decisions that it thinks serve the customers long term. When the political leaders insert their judgment, that’s the kind of thing that scares investors,” Avera said.
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Tags: Bill Avera, Charlie Crist, energy, Florida Power & Light, Florida Retail Federation, FPL, PSC, Public Service Commission, utilities
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September 16th, 2009 at 7:57 pm
Better than threatening the commissionors, Gov. Crist should have launch an investigation into backroom deals and influence peddling, though I do understand his outburst could be the heat of the moment. I really don’t argue with certain lobbying, but FP&L, as well as Insurance Co., have been running amok in this state with their greed, steadily bendng elbows to force their increases on the residents of Florida.
Everytime FP&L gets turned down for one increase, the launch another with a new focus, just to get what they want. I wonder how far some of these multi-million dollar salaries would go to not needing increases to meet employee salaries and expansion funding.
September 16th, 2009 at 9:33 pm
FPL is guaranteed a certain amount of profit if I remember the purpose of the PSC. Naturally, this so-called expert is hired by FPL to try to panic the market. The big utilities in Florida have been getting away with piracy for the last 20 years. It’s about time to rein in the PSC and their yes-men kissing up to FPL.
September 17th, 2009 at 1:07 pm
FPL’s lobbying isn’t the problem, it’s the political system and the blowhards at the PSC that should know better. Fix that and keep politicians like Crist from politicizing the process and you’ll see things change.
September 17th, 2009 at 8:33 pm
[...] FPL financial consultant said yesterday that the shifting political climate under Crist could bring the state’s largest utility to its knees by damaging its ability to [...]