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  1. Opinion

Editorial: Florida House should approve utility reforms

The Florida House should pass legislation that would reduce costs for Duke Energy ratepayers related to a broken nuclear plant and prevent some other abuses that have occurred in recent years.
The Florida House should pass legislation that would reduce costs for Duke Energy ratepayers related to a broken nuclear plant and prevent some other abuses that have occurred in recent years.
Published Apr. 24, 2015

With five days left in the Florida Legislature's depressing regular session, lawmakers still have an opportunity to provide significant rate cuts and modest protections for customers who have been exploited by the electric utilities. The House should pass legislation that would reduce costs for Duke Energy ratepayers related to a broken nuclear plant and prevent some other abuses that have occurred in recent years. This isn't the sweeping reform of utility regulation that Florida needs, but it is a good step in the right direction.

Passed unanimously by the Senate on Friday, the bill sponsored by Sen. Jack Latvala of Clearwater includes a complicated plan endorsed by Duke Energy that would change how costs are paid for cleaning up the closed Crystal River nuclear plant. Instead of ratepayers paying Duke roughly 7 percent in financing charges over 20 years, the legislation would enable the utility to sell that debt to investors who would get a lower return on their money. Lowering the financing charges would save Duke customers $600 million, or about $2 to $3 a month. Despite lawmakers' affection for the electric utilities, this provision alone should be enough for House Republicans who love tax breaks to send this bill to Gov. Rick Scott.

There are other positive provisions for consumers as well. For example, the bill would ban utilities from charging customers higher rates because their billing period was extended. That addresses the public outrage over Duke sending customers larger bills last year when they were pushed into higher rate classes only because the utility extended their billing cycles as it overhauled its meter reading system. Duke eventually apologized and gave customers credits on their bills. This legislation (HB 7109) also would set new limits on total electric deposits and require utilities to help customers get the most favorable rates.

There would be some progressive changes at the Florida Public Service Commission. For the first time, PSC members would be limited to serving 12 years and required to undergo ethics training. The bill is returning to the House for another vote because Latvala wisely insisted that the PSC hold public hearings every other year in the areas served by Duke Energy, Florida Power & Light, Tampa Electric Co. and Gulf Power. That is entirely appropriate, and House members will have to choose between their constituents and utility lobbyists fighting that modest requirement.

The utilities already have won too much. The House earlier removed a key provision sought by Latvala to preserve the effectiveness of the public counsel, who represents ratepayers before the PSC. For the first time, the commission in 2012 approved a settlement involving a rate increase for FP&L without the public counsel's endorsement. The Florida Supreme Court unwisely upheld that end run, and Latvala's original bill would have outlawed shutting ratepayers out in that fashion.

The Legislature should have approved much stronger reforms. It should have added incentives for solar power. It should have repealed the 2006 law that allowed Duke Energy to bill ratepayers more than $3 billion for nuclear plants that are broken or never will be built. It should have banned utilities from using ratepayers' money to pay for oil and gas exploration, which FP&L is doing.

The least the House can do this week is approve the modest reforms already approved by the Senate. It would save Duke customers money, and it would prevent some of the more egregious abuses of ratepayers.