Utilities win, Florida consumers (and Crist) lose as Tally legislators reject PSC candidates
Wake up and good morning. Well, we Floridians who watched the Florida Public Service Commission so briefly show some long-lost backbone earlier this year when the state regulator rejected higher rates sought by Progress Energy Florida and Florida Power & Light, we are again back under the political thumb of the power industry. The Florida Senate on Tuesday refused to confirm two of Gov. Charlie Crist's appointees to the PSC.
Politically, it's fascinating theater, if you don't mind the resulting nausea of watching Florida legislators at work. The Senate voted against confirming commissioners David Klement (photo above, left) of Bradenton and Benjamin “Steve” Stevens (photo, right) of Pensacola. Klement, a former journalist, got the thumbs down by a vote of 21 to 17. The argument? He lacked the financial background needed to understand how to regulate utilities. (Here's Klement's response, calling his experience a "farce.")
Then Stevens, an accountant, was defeated by a vote of 23 to 14.
As if we did not know it would happen this way. Yes, this was an obvious rebuke by legislators angered by (Republican in name only) Gov. Charlie Crist, who's been so busy lately vetoing Republican bills and who chose these two individuals for the PSC. But this is no less a classic, ham-handed victory and payback sought by Progress Energy and Florida Power & Light. Both companies were both embarrassed and angry that some uppity little state regulator in normally malleable Florida decided not to do what they wanted a few months ago: Raise electricity rates.
It's a domino effect. When the PSC nixed most or all of these two power companies' rate requests, Wall Street analysts and institutional investors smacked Progress Energy and FPL Group around. Wall Street's message to the power companies? If you can't control your rates in pesky Florida, we're not comfortable giving you top ratings to support your credit needs for future growth. Wall Street told these companies that Florida had a long tradition of being a pushover on rates but somehow there was a disturbance in the force. This new PSC that Crist had populated with independent thinkers -- good grief, consumer-oriented commissioners -- needed to be fixed. Fast. Read this earlier blog posting on how Progress Energy presents itself differently to Wall Street than its customers.
Game. Set. Match. The big power companies are sending a reassuring message to Wall Street that they are back in charge in Tallahassee. And you can be sure the next set of folks picked to replace Klement and Stevens will be pre-stamped-for-approval, sympathetic candidates to the liking of the utility industry.
If you want to laugh (or cry) at the legislators trying to defend their actions in rejecting these two PSC candidates, try the St. Petersburg Times piece here, or the South Florida Sun-Sentinel story here or the Miami Herald story here or this opinion piece from Sunshine State News headlined Nobody Greases the Political Machine Quite Like Big Power.
Tallahassee: Mission accomplished. Floridians: start emptying your wallets.
-- Robert Trigaux, Times Business Columnist