Florida Electric Utilities Line Up for Hurricane Damage Rate Relief

By: Mikle Vasilinda
By: Mikle Vasilinda

Over the next two months, state regulators will decide how much Florida Power and Light and Florida Energy will be able to add to customers’ electricity bills. They want to raise rates to cover repairs from last year’s hurricanes.

Some consumer groups say the utilities are asking for too much. Gulf Power was the first utility in the state to get approval for a special rate hike to cover last year’s hurricane damage to electric lines. It gets to add $2.71 a month for each 1000 kilowatt hours of electricity used. The average home uses just over that amount each month.

In all, Gulf Power will raise $51.7 million through the rate hike. After insurance its losses in northwest Florida was $96.5 million. The Public Service Commission granted the hurricane repair fee for only two years.

Florida Power and Light has been adding $2.09 a month since February to cover what it spent for repairs last summer. The money is subject to refund. Regulators will decide in July if Florida Energy can begin adding a hurricane surcharge. The two companies are asking for a combined $800 million.

The AARP and the Florida Retail Federation say it is too much.

Randy Miller is a spokesman for the retail federation and says, "We are very concerned in the overall impact of what the utilities are doing, we think it's plain simply greedy."

Lori Parham of AARP says that some of the costs being claimed would have been expenses anyway.

"For example we would be paying for the regular salaries of employees, which the utilities would've paid without or without the hurricanes."

The utilities say they need the cash to be ready for the next hurricane, but the two challengers say the request should be cut in half.

The basic argument goes like this, the utilities are in the business of selling you electricity which they can't do without poles and lines, so the groups say they should share some of the costs of keeping them up and running.

Sprint has indicated it will ask for more money for hurricane damage relief.

Bell South and Verizon will see what happens in the electric cases before they make any requests to the Florida Public Service Commission.


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