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Progress Energy, FPL want rate hikes without disclosing executive pay

TALLAHASSEE — In their bids to get electric rates increased next year, two of the state's top electric companies said Monday that it's not in the public's interest for them to disclose how much they pay top executives.

Progress Energy Florida and Florida Power & Light argue, in documents filed with state utility regulators, that disclosing how much they pay their executives in salaries, stock and bonuses is not necessary for the Public Service Commission to determine whether to allow them to raise rates by as much as 31 percent starting Jan. 1.

But the PSC staff argues that the salary data is essential to the regulators' ability to "evaluate the appropriateness of the employee compensation to be included in the rate base."

Progress Energy Florida wants permission to increase its base rates by $500 million a year, or 30 percent, starting Jan. 1. FPL is seeking a 31 percent rate hike that would raise $1.3 billion.

State regulators say they want to know how much the companies are paying their top employees to determine if ratepayers are picking up too much of the tab.

Commissioner Nancy Argenziano asked the staff to find out how many employees at the companies get paid more than $165,000 a year. In a letter last week to PSC Chairman Matthew Carter, Argenziano said it was the obligation of regulators to make sure that the "piggishness" of Wall Street wasn't reflected in Florida.

"More baldly: They don't care as long as the ratepayer picks up the tab," she wrote. "Thus, the PSC is the only policeman on the block."

The PSC will determine Aug. 18 whether to force Progress Energy and FPL, as well as the state's other investor-owned utility companies, to report executive compensation. In a motion filed Monday, Progress Energy attorney James Walls argued that if the company is forced to disclose what it pays its top executives, it will "harm PEF's competitive business interests."

The companies have supplied the PSC with part of its request, but they left out the names of the employees attached to the salaries and asked that the information remain confidential.

Argenziano countered that if the PSC isn't given the names, it can't ensure that the companies aren't compensating employees because of their personal relationships with executives.

Also Monday, Florida Public Counsel J.R. Kelly filed a motion arguing that Progress Energy Florida should be stopped from getting its $500 million rate increase and instead be ordered to lower its rates $35 million.

He says the St. Petersburg-based electric company has been making hefty profits by accumulating $850 million in excessive depreciation, and that money should be returned to customers.

Kelly made similar arguments in opposition to FPL's rate case. He argued that FPL should decrease its rates by $364 million in 2010 instead of raising them $1.3 billion.

The commission will begin hearings on FPL's request on Aug. 24. Progress Energy's hearings will begin in September.

Progress Energy, FPL want rate hikes without disclosing executive pay 08/10/09 [Last modified: Tuesday, August 11, 2009 11:44am]
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