FPL to implement $900 million rate hike before PSC voteby Dara Kam | September 25th, 2009
Florida Power & Light Co. plans to raise rates by more than $900 million beginning Jan. 4 without waiting for the Public Service Commission’s decision on whether to grant the requested increase, according to a letter from an FPL executive sent to the panel today.
Florida law allows the utility to implement the rate hike without the regulatory panel’s approval, but FPL would have to refund the difference to customers if the PSC authorizes a smaller increase. The regulatory board’s final decision is now scheduled for Jan. 11 because the rate case has run into overtime.
PSC Chairman Matthew Carter today refused to grant FPL’s requests from earlier this week to make a decision by Dec. 4.
Instead, the PSC will keep its schedule of finishing its hearing Oct. 21-23, voting Dec. 21 on the total amount FPL can collect and voting Jan. 11 on how that increase will affect different types of customers, such as homeowners and businesses.
The Juno Beach-based company’s proposal would allow it to charge customers an extra $900 million a year beginning in 2010 and another $400 million a year beginning in 2011.
FPL sent three letters this week, including one today from FPL Vice President Wade Litchfield, asking Carter to expedite the hearing to avoid FPL putting the new rates into effect before the panel votes.
“The provision for refunds would fully protect customers against overpayment: any portion of FPL’s proposed rates that was not approved would be fully and promptly refunded to customers, so that their net payment starting on January 4, 2010 would be only the amounts resulting from the Commission-approved rates,” Litchfield wrote.
The hearing, which began in late August, has been prolonged in part, Carter said previously, because it is the first rate case of this magnitude the panel has heard and the first FPL base rate case in more than two decades.
But FPL says the PSC has plenty of time to finish the proceedings before the end of the year. The utility needs to know what the panel’s decision will be so it can move forward with projects, FPL spokesman Mark Bubriski said in an e-mailed statement.
“The Commission staff’s proposed delay in this rate proceeding creates unnecessary delay and uncertainty with regard to projects that are bringing a lot of value to Floridians, now and in the future. These projects represent thousands of construction jobs at a time when they are needed most, hundreds of millions of dollars in new tax revenues for Florida communities and billions of dollars in capital investment, and the reality is that this can all be accomplished while lowering customer bills,” Bubriski wrote.