South Miami, Pinecrest Oppose FPL Rate Hike

South Miami commissioners passed a resolution last Tuesday opposing Florida Power & Light’s proposed base-rate increase.

FPL called the resolution and a similar one that the Village of Pinecrest filed April 24th as “misleading.”

Local officials filed the resolutions with the Florida Public Service Commission, the agency looking into FPL’s 2013 proposal for a $690.4 million annual rate increase. Mayor Philip K. Stoddard sponsored South Miami’s resolution.

“Their stock is up 13 to 14 percent for the year already. I don’t think they are hurting,” Stoddard said. “I’m not sure why we would want our rates increased in order to reward the shareholders.”

FPL spokeswoman Alys Daly said Stoddard’s characterization was misleading, because it ignored the power company’s past efforts to “sustain the company financially without raising customer rates.” The resolution states that FPL benefits from more cost recovery mechanisms than any other regulated utility in the United States.

“FPL’s allowed return on equity is the lowest of Florida’s investor-owned utilities and is in the bottom quartile of the country,” Daly said.

FPL external affairs manager Ramon Ferrer told commissioners “the typical residential bill in 2012 was actually about 13 percent less than it was in 2006.”

FPL’s latest estimate on the proposed increase is $1.41 a month. The first proposal filed on March 19th estimated a $2.48 increase. But on Tuesday, FPL reported a $1.07 error. The calculations are based on the average consumer, which FPL defines as 1,000 kilowatt-hours per month.

South Miami, Pinecrest and neighboring cities also have been fighting FPL’s proposal to build power-transmission lines on U.S. 1.

Stoddard said a rate increase would hurt city residents and further strain limited resources.

South Miami Vice Mayor Josh Liebman and commissioner Bob Welsh agreed with Stoddard and authorized him to file the resolution with the PSC. Commissioners Valerie Newman and Walter Harris voted against it.

Newman classified the rate increase as “reasonable” and added that she didn’t think it was a good idea to go against the state’s largest electric utility before hurricane season.

“FPL recognizes that no one ever wants a rate increase, particularly in uncertain economic times. We do not make our request lightly,” Daly said.

FPL has not had a base rate freeze since 2009. It expires at the end of the year. For the increase to occur, PSC commissioners have to approve FPL’s proposal. PSC commissioners are scheduled to host several public hearings in South Florida.

“I’m not familiar with any other cities that have done this,” Cindy Muir, PSC’s director of public information, said. “Commissioners will take all of the feedback from the community into consideration before making a decision.”

Source: Miami Herald

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