PSC approves $2 rate hike for Florida Power & Light customers, Progress decision up next
Florida utility regulators unanimously approved a $2.09 a month rate increase for the average Florida Power & Light customer beginning in January so that the company can continue to pay for plans to build nuclear power plants.
Under a state law approved by the legislature in 2006, the company can collect the money but can change its mind and never build the facility. The commission unanimously approved the rate increase, arguing that they were required to do so based on the statute.
The ruling completely accepted the arguments of FPL, which asked for $196 million in cost recovery for upgrading its nuclear units and for planning two new reactors at Turkey Point. The cost to customers will be $2.09 for every 1000 kilowatt hours used, up from 33 cents per month, for that estimated electricity usage.
The commission rejected arguments by the Office of Public Counsel, which represents the consumer in rate cases, which argued that the commission should deny the request because the company has no clear intention to build the plants and has misled regulators. It also rejected requests by the Southern Alliance for Clean Energy which recommended the PSC halt giving the utilities the ability to charge customers for nuclear power because of questions surrounding the technology in the wake of the Fukishima nuclear disaster in Japan.
The commission is still debating whether or not to accept Progress Energy's request to lower the existing nuclear charge from $5.53 per month per kilowatt hour to $4.68 per month to collect $140 million towards a new nuclear power plant at its Crystal River facility.
"I find that the utility has done what the statutes has asked for,'' said Commissioner Ron Brise. He said that it could hurt investment in the state if the commission decides not to give the utilities what it wants.
Commissioner Julie Brown asked if the statute specifically calls for proof that the company needs to show that it intends to build a plant. Staff lawyer Keino Young said yes but noted that the company doesn't have to decide to definitely build a nuclear plant in order to charge customers and collect money for it. "Is necessary that final decision be made prior to allowing recovery? No," Young said. "...If the company is engaged in siting, license, construction or construction of a nuclear power plant, they meet the intent requirement of your order."
Commissioner Eduardo Balbis said he is comfortable with allowing the companies to charge customer so they can pursue the option of building a nuclear plant as the commission has allowed them to do for the past several years. The PSC shouldn't stop allowing the company to move forward on this because "making an irrevocable decision at this time of a project of this magnitude may not be reasonable.''
The utilities must come back every year, he added, and "we are monitoring this. The utilities are monitoring this."
The PSC, a governor-appointed body, makes its decision based on input from the utilities, from the state's consumer advocate, and from the PSC professional staff, now led by Braulio Baez of Miami, former PSC commissioner who has spent the last five years working as a lawyer, often representing utilities.
The staff recommended the PSC adopt the utilities request for $196 million in cost recovery and also recommends accepting Progress Energy's request for $140 million towards a new nuclear power plant at its Crystal River facility.
The mayors of Pinecrest and South Miami call the request "corporate welfare" and are leading an effort to repeal the legislation that gave the PSC the ability to raise fees for nuclear power without requiring them to build them.
The change will be reflected on customer bills beginning in January.