TALLAHASSEE — Florida’s public utilities are one step closer to beginning significant efforts to harden the state’s electrical grid and move power lines underground.
State utility regulators voted Thursday to approve a draft rule that outlines how the utilities must go about reporting their plans for such efforts and collecting related costs.
But the proposed rule went against staff recommendation and left out requirements that consumer advocates say give the utilities wiggle room to double-charge consumers for the hardening efforts and make it difficult to ensure utilities follow through on their proposed plans.
“To gut that in the rule I think was a disservice to the customers and the rate-paying public for such an enormous, significant cost,” said Charles Rehwinkel, lawyer with the Office of Public Counsel. “I think it was just short-sighted.”
The rule was spurred by a state law passed in June that requires public utilities to make their existing electrical infrastructure stand up to storms more effectively. A significant component of this is moving outage-prone portions of the infrastructure underground.
Under the new law, utilities must submit a 10-year plan for how they will accomplish this. They also will be able to collect the cost for the projects from customers in a new “storm hardening" charge.
One of the most contentious aspects of the rule-making process thus far was how specific the plans needed to be. The law requires that utilities project the cost to consumers for the first three years of the plan.
Utilities such as Florida Power & Light argued that it would be too cumbersome and unreliable to outline exactly which projects utilities will complete over several years, asking instead to provide high-level cost estimates for general project categories, such as undergrounding.
But consumer advocates say specificity is important. The projects involved in grid hardening are significant and are planned well in advance, and being able to track utilities’ efforts ensures that the plans get done.
It would also help ensure that utility customers aren’t charged more than once for a project that should only fall under either their normal base rate or under the storm hardening charge, but not both.
To accomplish this, consumer advocates and commission staff proposed three years of specific plans.
“I don’t think we can fully distinguish between base rate activity and what they are trying to run through the (storm hardening) clause without that level of detail,” said Shelby Eichler, a public utility analyst on the commission staff.
Going against the commission staff’s recommendation requiring specificity, Commissioner Andrew Fay proposed moving forward with a version of the rule that requires just one year of specific plans from utilities and more general estimates for the second and third year of the plans. It was unanimously approved by the commissioners.
If this version is finalized, it means there will not be an easy way to tell which specific projects a utility completed in its second and third years of the plan, how much they cost individually and whether it charged customers for those already in its base rates.
If the rule is not contested, it could be finalized by the end of the year. Utilities will then file their plans and budget requests, but customers likely won’t see an uptick in bills until 2022.