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Progress Energy or Tampa Electric: Who sells electricity for less?

One area utility wants to raise your already higher-priced electric bill by $6 a month. The other wants to cut your cheaper monthly electric bill by 10 cents.

Which bill do you want?

Progress Energy Florida, which serves the bulk of Tampa Bay and west-central Florida, seeks to add $6 to the average monthly bill. That means typical residential customers, who use 1,000 kilowatt hours a month, would see their bills rise from $119.34 to a little more than $125.

Smaller Tampa Electric, serving most of Hillsborough County and a modest slice of central Florida, plans to cut a dime each month off the $107.02 it charges for the same amount of electricity.

That's a monthly difference of about $18 — more than $216 over the course of a year — between the two utilities.

Both proposed price changes reflect the updated cost of fuels the utilities use to run the power plants that produce electricity. If the Public Service Commission okays these price changes, they will take effect in January.

Think of the price you pay for electricity as you would any basic commodity. The utility that can provide power at a lower price operates more efficiently. It can charge you less and still make enough money.

For now, at least, Tampa Electric is trouncing Progress Energy Florida as the utility better able to keep your lights on for less. (Neither company is allowed to make any profit from the fuel portion of customer bills.)

The sharp difference in prices reflects different strategies by the two companies.

Progress Energy Florida relies on natural gas, coal and nuclear power as its main fuels to generate electricity. The utility's sole nuclear power plant in Florida, the Crystal River plant in Citrus County, was shut down two years ago for repairs and does not generate electricity. The company has had to replace that lost power by generating more electricity at other plants and by purchasing electricity from other utilities. That is expensive.

Buying power from other utilities accounts for $2 of the $6 average increase. Another $3.99 comes, at least in part, from more expensive fuels required to generate the electricity no longer produced by the closed nuclear plant.

"We are working every day to become more efficient while continuing to provide our customers clean, reliable, affordable power now and in the future," Progress Energy Florida CEO Vincent Dolan said in a written statement.

In contrast to the Progress increase, Tampa Electric — which has no nuclear plants — says this is the fourth consecutive reduction in fuel costs over the past three years.

"In these challenging economic times, a decrease is a move in the right direction," stated Gordon Gillette, president of Tampa Electric, part of TECO Energy. "We are pleased to be able to maintain low, stable bills while providing outstanding value to our customers."

In fact, he suggests, after adjusting for inflation, Tampa Electric customers would be paying bills that are 17 percent lower than 20 years earlier.

The PSC still must agree on Progress Energy Florida's nuclear charge on Oct. 24. That means the utility's final price for electricity come January may yet change.

I wonder. Tampa Electric: Can you share a few tips with your utility neighbor on running a tighter ship?

Contact Robert Trigaux at trigaux@sptimes.com.

Breaking down the $6 per month increase

Here's how Progress Energy Florida arrived at its proposed increase of $6 a month for the average residential customer:

Fuel: increase of $3.99 (from $44.61 to $48.60)

Purchased power: increase of $2 (from $9.74 to $11.74)

Environmental compliance: increase of 92 cents (from $4.91 to $5.83)

New nuclear generation: decrease of 85 cents (from $5.53 to $4.68)

Energy-efficiency programs: To be filed separately on Sept. 13; projecting a slight decrease from the current $2.99 charge.

* The average commercial customer's power bill will rise 4 to 6 percent, and the average industrial customer's bill will increase 5 to 7 percent, according to Progress Energy Florida.

Progress Energy or Tampa Electric: Who sells electricity for less? 09/02/11 [Last modified: Saturday, September 3, 2011 1:23pm]

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