Florida Power & Light (FPL) says its proposed base-rate hikes are essential to support growth and maintain system reliability, all while keeping electric bills below the national average. (FPL) says its proposed base-rate hikes are essential to support growth and maintain system reliability, all while keeping electric bills below the national average. But critics argue the multibillion-dollar plan is excessive and must be scaled back.
The Florida Public Service Commission is set to hold a potentially contentious hearing in September to evaluate the proposal, which would impact how much FPL customers pay for electricity over the next four years. In preparation, FPL and various consumer and business groups submitted detailed prehearing statements outlining their positions.
FPL is seeking approval for a $1.545 billion increase in 2026 and another $927 million in 2027. Additional costs tied to solar energy and battery storage projects would be passed on to customers in 2028 and 2029. In its filing, FPL emphasized the need to invest in new infrastructure to serve an expected 335,000 additional customers by 2029.
“To meet this new growth and maintain operational reliability, FPL must invest in generation, transmission and distribution,” the utility stated. “Each of FPL’s new customers deserves the same outstanding reliability and low bills that existing customers have long experienced.”
But opponents, including the state Office of Public Counsel (OPC), argue the utility’s proposal places an unfair burden on customers. The OPC estimates the increase would lead to a cumulative $9.819 billion in additional charges over the four-year period.
“In today’s tough economic climate, FPL’s customers are already under great financial pressure,” the OPC said. “Now, more than ever, the commission must acknowledge that unreasonable and imprudent costs are driving unfair, unjust, and unaffordable bills. Over 12 million Florida residents and businesses will be directly impacted by this decision.”
Base rates make up a substantial portion of monthly electric bills, along with fuel and other operational costs. The commission will evaluate extensive financial data and projections before making a decision.
Interest in the case is high, with 14 prehearing statements submitted by organizations including the Florida Retail Federation, Southern Alliance for Clean Energy, Florida Industrial Power Users Group, Walmart, and the League of United Latin American Citizens of Florida.
FPL’s current four-year rate plan, approved in 2021, expires at the end of 2025, prompting the new request. Unless a new settlement is reached, hearings are scheduled to begin August 11. While opponents have not specified an acceptable alternative increase, the Florida Industrial Power Users Group recommends reducing FPL’s proposal by more than 50 percent.
One key point of contention is FPL’s proposed “return on equity” — a metric reflecting the utility’s profitability. FPL has proposed a midpoint return of 11.9 percent, arguing it is necessary to maintain investor confidence and credit strength.
“Fundamental to FPL’s value proposition is the maintenance of a strong credit rating and balance sheet,” the utility said, emphasizing the need to fund infrastructure and manage unexpected challenges.
But the OPC recommends a return of just 9.2 percent, while the Florida Industrial Power Users Group argues it should not exceed the 10.5 percent midpoint recently approved for Tampa Electric, or the 10.3 percent granted to Duke Energy Florida.
Source: WGCU