Make us your home page

You want to charge us HOW much?

Progress Energy Florida is asking for a $500 million annual increase in its base rates, a 30 percent hike.

Two questions:

(1) Is an increase of that size justified?

(2) If not, how are the people to fight it? (For the answer, read on. You can get started as early as this Thursday.)

The answer to question (1) is, of course, no. The company is shooting for a rate of return on its stockholders' money of 12.54 percent.

Twelve and a half percent! Who gets that these days? A company lawyer argued the other day that Progress has to compete "with the IBMs, the McDonald's, the Wal-Marts of the world for investors."

Phooey. Nuts. Apples and oranges. The company is a perfectly reliable investment. It has been stumbling by, somehow, on a paltry 9 percent plus. The state Public Service Commission should not give it much more. This puppy needs to come in under 10 percent.

"People look to utilities for stable, firm investments," says J.R. Kelly, the state's public counsel, who represents customers in utility cases.

"They have a monopoly. They have a captured audience. McDonald's has to compete with Burger King and Wendy's — their income is not guaranteed."

It's also high time that the PSC use this rate case to dig deeper into Progress' books — into what counts as an "expense" above the bottom line, before we even get to the question of profit.

Here's an example: The Office of Public Counsel thinks Progress is writing off the value of its plants too fast. This means a higher depreciation expense, paid for by customers. There's also fighting over how the company is counting pension expenses.

I would like to tell you that the PSC has been a tough, aggressive regulator.

I would like to tell you that.

Unfortunately, in its last time at bat, the PSC gave a sloppy wet kiss to Tampa Electric Co. this spring. The national average return is 10.29 percent. The PSC's own staff had recommended 10.75 percent. The PSC said "what the heck" and awarded Tampa Electric 11.25 percent.

As for Progress, so far the PSC has been a purring kitten, letting the company have "interim" rate increases even before this big one is approved (hey, they'll refund it later if they don't approve it), and allowing the company to bill now for the cost of converting one of its plants from oil to gas. The PSC's only recent ruling against Progress, for overcharging for coal, will reduce the typical bill — next year — by 25 cents a month. Wooo!

By the way, we're not even talking about billing customers in advance for a nuclear power plant, or fuel charges and such. All that stuff is separate these days.

The second question was, how can the public fight this?

One way will be to show up at the public hearings around the state. One in Pasco County last week was well attended.

There will be hearings this Thursday in St. Petersburg (9 a.m. at City Hall, 175 Fifth St. N) and Clearwater (6 p.m. in the County Commission room, fifth floor, 315 Court St.)

And beyond that? Well …

Gov. Charlie Crist, who wants to be a U.S. senator, chooses the PSC — these are his folks making this decision. Bill McCollum, the attorney general, and Alex Sink, our chief financial officer, want to be governor. So I would raise heck with all of them, too, and make them take a stand.

Time to step up.

You want to charge us HOW much? 07/11/09 [Last modified: Tuesday, July 14, 2009 11:27am]
Photo reprints | Article reprints

© 2017 Tampa Bay Times


Join the discussion: Click to view comments, add yours

  1. Ousted to political Siberia by Corcoran, Kathleen Peters sets sights on Pinellas Commission

    State Roundup

    TALLAHASSEE — The perks of power in Tallahassee are a coveted chairmanship, a Capitol office in a prime location and a prominent seat on the House floor. Now Rep. Kathleen Peters has lost all three, but here's the twist: Her trip to "Siberia" might actually help her reach the next step on the Tampa Bay political …

    Rep. Kathleen Peters, R-South Pasadena, has been relegated to the back row in the State House chamber, moved to a fouth floor office and stripped of her job as chairwoman of a House subcommittee after a series of disagreements with House Speaker Richard Corcoran. [SCOTT KEELER | Tampa Bay Times]
  2. UPS relocates express operations from St. Pete-Clearwater to TIA


    TAMPA — United Parcel Service Inc. is switching airports for its express air operations. Beginning in October, UPS will relocate from St. Pete-Clearwater International Airport to Tampa International Airport.

    Beginning in October, UPS will move from St. Pete-Clearwater International Airport to Tampa International Airport. [Associated Press file photo]

  3. Richard Corcoran takes aim at public financing of campaigns

    State Roundup

    TALLAHASSEE — House Speaker Richard Corcoran, R-Land O'Lakes, may not be running for governor — not yet anyway — but his latest idea will get the attention of those who are.

    House Speaker Richard Corcoran wants the Constitu?tion Revision Commis?sion to ask voters to repeal the state’s system of partial financing of statewide elections.
  4. Related Group breaks ground on complex at old Tampa Tribune site

    Real Estate

    TAMPA — When Miami developer Jorge Perez first eyed a 4.2-acre tract on the west bank of the Hillsborough River two years ago, people asked him if he wouldn't prefer to build on the opposite side closer to the downtown core.

    No way.

    From left, Related Group executive associate Arturo Penaa, Jorge Perez, center, founder and CEO of the Related Group, Mayor Bob Buckhorn and Steve Patterson, the President of Related Development dig their shovels  during the groundbreaking ceremony of the 400 unit Riverwalk Manor apartment complex on site of the old Tampa Tribune building on Wednesday. [OCTAVIO JONES | Times]
  5. Eat 3-course meals for $35 at these 100 restaurants for Orlando's Magical Dining Month

    Food & Dining

    In the early 1900s, hotels offered "table d'hote" or "prix fixe" menus as a form of loss leader. Hotels didn't necessarily make money on these lower-priced, multi-course meals, often served at communal tables, but they made up for it on the booze. Prohibition may have contributed to a gradual shift toward a la carte …

    Bulla Gastrobar serves a variety of Spanish and Portuguese dishes.