FAIR to appeal FPL’s planned rate increase
Florida Power & Light’s plan to generate $4.9 billion in new revenue over four years faces a challenge in the state Supreme Court, but consumers shouldn’t expect any delay in rate hikes set to begin next month.
The group Floridians Against Rate Increases (FAIR), which was formed earlier this year to oppose FPL’s requested four-year rate plan, on Monday filed a notice of administrative appeal that by law must be heard by the state Supreme Court.
The appeal, which has not yet been filed, will argue that the Florida Public Service Commission exceeded its authority when it approved “certain rate-making procedures” within the rate plan, FAIR’s attorney, Robert Scheffel Wright, said Monday.
The provisions would enable FPL to use “unique depreciation accounting mechanisms” to generate more revenue than it should be allowed to make, Wright said.
A FAIR filing in October challenging FPL’s proposal states that FPL’s accounting methods would “unfairly, unjustly and unreasonably” deprive consumers of up to $1.4 billion over the four years.
Responding to FAIR’s announcement, FPL spokesman Bill Orlove said the organization was “uninformed with their assertions” and defended the accounting mechanism as beneficial to customers.
FPL has argued that it needs the rate increases, which will be phased over four years in beginning in January, to help finance clean energy upgrades, such as expansion of solar energy generation capacity.
But critics blasted the plan for allowing FPL’s owner-investors to reap a 10.6% return on equity — higher than most other investor-owned utilities in other states.
Efforts to appeal FPL rate plans have borne little fruit in recent years. Appeals in 2012 and 2016 failed. In addition, filing an appeal does not prevent pending rate hikes from proceeding as planned.
Meanwhile, consumers should brace themselves for higher power bills beginning next month.
FPL estimated in October that a consumer of 1,000 kilowatts per hour of electricity would see monthly bills rise from $101.70 to $113,85, on average, starting next month.
But in early December, the utility received approval to hike monthly bills even further to reflect increases in the cost of natural gas used to fire FPL’s power plants.
The fuel cost increase, which also takes effect in January, will increase that 1,000 kWh bill from $113.85 to $120.67 — a hike of nearly $20 a month.
In a news release, FAIR president Mike Hightower was quoted as saying that FPL’s rate increase ‘is nothing more than a multi-billion-dollar special interest money grab.”
Ron Hurtibise covers business and consumer issues for the South Florida Sun Sentinel. He can be reached by phone at 954-356-4071, on Twitter @ronhurtibise or by email at rhurtibise@ sunsentinel.com.