Utility regulators deal blow to FPLby Dara Kam | November 3rd, 2009
The Florida Public Service Commission created what could be yet another public relations nightmare for the state’s largest utility yesterday.
Utility regulators ordered Florida Power & Light Co. to refund $364.8 million in fuel surcharges in a one-time payment to customers because of a drop in fuel prices.
The refunds are normally spread out over one year.
But Commissioner Nathan Skop wanted customers to get the one-time break.
As a result, FPL customers’ January bills will be about $44 cheaper as a result of yesterday’s decision.
But the next month the bills will go back up, leading to instability for customers, FPL argues.
They want customers’ bills to be consistent from month to month so residents and businesses can plan for their utility expenses.
The power company also likely wants to avoid the fallout from the sticker-shock of a bill going up $44 from one month to the next.
“While today’s action was outside the normal process for dealing with these variations, we’re happy to be able to help customers, particularly in these difficult times. Moreover, 2010 bills will be going down as a result of greater fuel efficiencies and lower fuel costs even with the full impact of our rate request. That’s good news for customers since it combines lower bills with greater investment in making the electrical infrastructure stronger, smarter, cleaner and even more fuel efficient,” FPL said in a statement yesterday.
The Juno Beach-based utility backed off of $53 million in charges from the proposed base rate increase, scrubbing $16 million it had wanted to charge customers for corporate jet travel and to buy a new plane. FPL also cut in half the amount of executive pay and bonuses it was asking customers to pay. Customers would now pay only $37 million of the execs extras under the proposal.
Last week, the panel voted to delay the rate case until next year when Gov. Charlie Crist’s new appointees will be on board.
FPL wanted to move forward with the case in part because of customers’ bills.
Because of the reduction in fuel charges, the bills will go down in January. FPL had wanted the base rate increase, about $9 a month for 1,000 kwh, to go into effect at the same time so the base rate hike would be “offset” by the reduction in fuel costs.
That won’t happen.