Commission defers Florida Power & Light fuel rate increases

The Florida Public Service Commission on Tuesday afternoon voted 3-2 to spread Florida Power & Light's requested fuel rate increase over 17 months instead of allowing the utility to recover all of the money this year.

The commission reached the same decision earlier in the day for Progress Energy. As in the Progress Energy decision, commissioners Katrina McMurrian and Nancy Argenziano dissented.

McMurrian though the utilities should be able to recover all of the increase in fuel costs this year. Deferring the payments over 17 months means interest charges will be added on, increasing the cost to customers. Plus, additional fuel increases may be likely for 2009 if fuel rates continue to soar, leading to "rate shock" in 2009.

Argenziano insisted that she would not allow fuel cost recovery until the commission had the opportunity for a broad review of electricity bills.

The Juno Beach utility is the largest in the state, serving 4.4-million customers. Its customers will begin seeing the rate increase starting in August.

According to FP&L spokesman Mayco Villafana, the rates will be as follows:

1. Current rates are $102.63 for 1,000 kilowatt hours.
2. As of August, it will go to $110.77 through December 2008.
3. From January 2009 through May, rates will be $120.93.
4. From June 2009 through December 2009, rates will be $122.36.

Those rates do not reflect the continuing increase in fuel costs, which could send prices still higher in 2009. The rates include the advanced cost recovery for the utility's two new nuclear reactors planned at Turkey Point. It also includes the cost of building West County Energy Center's Unit 1. (It’s the first of three units. The two units under construction aren’t reflected in rates yet.)

-Asjylyn Loder, Times staff writer