Wednesday, April 18, 2018
Business

Lower energy conservation goals will protect ratepayers, utilities tell PSC

TALLAHASSEE — It might seem a stretch, but Florida utilities this week billed themselves as a friend of the poor and the common man.

As such, they pressed the state Public Service Commission over the past three days to abandon a pilot program that offered rebates for residential and commercial solar panels that they argued benefit a few at the expense of the many. And they said they are designing efficiency programs to guard against consumers known as "free riders," who take advantage of energy-saving programs that they already would pursue without inducements from utilities.

Critics of the utilities argue that power companies aim only to maintain their lock on generating electricity and keep their profits high on the backs of all ratepayers. That includes making it difficult for the poor, low-income and middle class to benefit from the widest range of energy efficiency and conservation measures such as low-flow shower heads and LED light bulbs.

At the center of the debate in this week's PSC hearings, which wrap up the once-every-five-year Florida Energy Efficiency and Conservation process, is a move by Duke Energy, Tampa Electric and Florida Power & Light to gut their energy-saving goals by 93 percent. How the commission eventually votes will help set the course for how Floridians' energy needs are met over the next 10 years.

Florida already trails many states with energy efficiency programs, meeting just 0.25 percent annually of its power demand with electricity-savings programs and conservation. As modest as those energy savings ambitions are, the utilities want to drastically reduce their goals. Some states, such as Vermont, meet as much as 2.12 percent of their energy needs through efficiency efforts.

The utilities argued that many of the energy efficiency and conservation programs are no longer cost-effective.

Howard Bryant of Tampa Electric said in testimony Wednesday that the utility wants to ensure it does "not create a massive giveaway program of measures that are not cost-effective."

Utilities support programs that make sense, he said.

"All of us have programs, specifically Tampa Electric, that we are delivering into the marketplace now. We are putting forth what is cost-effective."

But David Guest, a lawyer representing the Southern Alliance for Clean Energy, pointed out during the hearings that the utilities, contrary to their assertions, support programs that benefit the rich while eliminating those anyone could afford.

Guest said, for instance, "60 percent of the measures being proposed by FPL are limited to people who can write $800 to $1,500 checks for very high-efficiency air conditioners that save a fortune on their bills."

The five-member PSC now must determine whether to support the utilities, side with the power companies' critics who want a 1 percent annual energy efficiency goal or pursue a new policy.

There's one thing on which everyone agrees: Times are changing. Low natural gas prices help make production of electricity cheap. Advanced energy-efficient products are reducing electricity demand. Solar power also has shown a steady drop in price, prompting more residential and commercial customers to install sizable arrays atop buildings.

Tampa Bay's Great Bay Distributors Inc. is among those taking advantage of solar's falling price. The state's top distributor of Anheuser-Busch products is developing the largest commercial solar array in Florida atop its new St. Petersburg headquarters under construction just south of the Valpak site off Interstate 275. Great Bay is benefiting from a 30 percent federal tax credit.

With federal requirements and incentives as well as consumers' own energy efficiency efforts, the utilities said they had to rethink their policies.

"We've reached a reset" time in terms of Florida energy efficiency policy, Stephen Sim, a senior manager for FPL, said Wednesday.

Florida regulations do allow utilities to seek incentives for themselves if they exceed whatever energy efficiency and conservation goals the PSC sets, even at the drastically reduced levels proposed.

Some utility representatives said they had not determined if they would seek that incentive if the commission awards the lower goals and they exceed them.

Contact Ivan Penn at [email protected] or (727) 892-2332. Follow @Consumers_Edge.

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