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FPL Rate Increase Request Now up to State Regulators

At a series of public hearings across the state, Floridians 50+ and other consumers largely opposed a proposed $690 million electric rate increase in base rates requested by Florida Power & Light. But consumers won’t know until later this year whether state utilities regulators will grant or reject the full FPL rate increase request – or whether regulators will split the difference.

See Also: Affordable Utilities Now

“At a time when most older Floridians would be delighted to find a CD paying more than 2 percent return on investment, FPL is asking for base rates that would offer their investors more than a 10-percent rate of return,” said Jeff Johnson, AARP’s Florida state director. “We think that’s too much.”

In public hearings across the southern two-thirds of the state earlier this year, AARP Florida volunteers, members and ordinary consumers spoke in opposition to the base-rate increase. Johnson said testimony at the public hearing trended mostly toward opposition to the base-rate increase.

Charles Milsted, AARP Florida Associate State Director and AARP’s point person on Florida utilities issues, said that AARP volunteers not only questioned FPL’s need for additional shareholder return, they also questioned FPL’s “fuzzy math” in arguing for the rate increase.

FPL consistently has minimized the apparent impact of the base-rate increase by mixing increased consumer costs because of the base-rate increase with smaller costs for fuel because of lower-than-projected prices for natural gas, which is used to power many Florida electric plants.

Under state law, regulated utilities must pass along to consumers all of the savings they achieve when fuel costs are lower than projected. So smaller FPL fuel bills would contribute to lower consumer power costs whether or not state regulators approve the base-rate increase, Milsted noted. “FPL’s numbers are based on a flawed apples-to-oranges comparison,” he said.

Johnson also noted that even after a series of public hearings on the proposed rate increase, FPL customers can still weigh in on the rate increase request. However, he said, consumers will have to be persistent to make their views known to commissioners. The system designed by the PSC to collect public input after the hearings have ended “is cumbersome at best,” Johnson said.

Here’s how the system works: Go to the Florida Public Service Commission’s website and download the Commission’s “Special Report” on the FPL rate request.

Johnson stressed that any comments you provide on the proposed increase must include the case docket number (120015-E1). “Please copy the number carefully, because if the number isn’t correct, the commission won’t consider your comments,” he said.

Consumers should provide their thoughts about the proposed base-rate increase at the end of the six-page special report. The completed form may be mailed to the PSC at: Florida Public Service Commission, Office of Commission Clerk, 2540 Shumard Oak Blvd., Tallahassee FL 32399-0850. The form also may be faxed to 1-800-511-0809; or scanned and e-mailed to contact@psc.state.fl.us. Again, written comments, faxes or e-mails must include the correct docket number (120015-E1) to be considered by PSC commissioners.

The PSC will decide on the FPL rate request by November. If approved, the rate increase would take effect in 2013 and would be permanent.
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