State regulators on Tuesday unanimously approved a Duke Energy Florida plan that will raise customers’ rates.
Residential customers’ monthly bills will go up between 3 percent and 4 percent over a three-year period, which begins in January. The exact amounts will be determined later this year when fuel costs and other calculations are factored in.
The new rates will cover the power company’s plan to revamp its energy grid and retire its coal plants earlier than expected. The plan focuses on improving Duke Energy’s power grid reliability, increasing electric vehicle charging programs, dropping credit card fees for residential customers on bills and decreasing hurricane-related costs. Its two coal generators at its Crystal River plant will be retired in 2034, eight years sooner than planned.
“Overall this is a great product,” commissioner Mike La Rosa said at the hearing. “This is ultimately in the public’s best interest.”
The rate increase comes as part of an agreement between the utility, consumer advocates at the Office of Public Counsel, Florida Industrial Power Users Group, Nucor Steel Florida and White Springs Agricultural Chemicals.
Working with consumer advocates and groups that may be significantly affected by the rate increases ahead of time helps utilities avoid legal costs from any challenges to the rates after they are proposed.
The agreement also locks in the lowest range for return on investment for that three-year period of any utility in the state, the median of which is 9.85 percent. Lower returns there means less for customers to pay.
Later this year, regulators will decide whether to approve substantial rate increases from Tampa Electric Co., which is asking for a 19 percent rate hike to cover new solar plans and transitioning its Big Bend Power Plant to natural gas, as well as a $2 billion increase in rates for Florida Power & Light.