Rate Case Roundup: Florida

The rate hike ultimately granted an electric utility by the Florida Public Service Commission likewise was set forth in a settlement. Under that agreement, the utility, Gulf Power Company, was permitted to raise its rates by $61.99 million. That compares to the $106 million in additional revenues for which the company had first petitioned. 

The commission noted that the net increase consumers will experience will actually be somewhat lower, at $54.3 million. That is because of a $7.7 million credit applied to the overall increase to account for an adjustment in the company's purchased power capacity clause. 

The utility's new revenue requirement is premised on a ROE range of reasonableness of 9.25% to 11.25%. The commission observed that the midpoint ROE of 10.25% is the same as the ROE authorized in Gulf Power's last rate case. 

The commission focused on a couple of terms in the settlement, including those governing the ratemaking treatment of the utility's ownership share of the Scherer Unit 3 coal-fired power plant, which is located in Georgia. The commission reported that the utility had agreed to a one-time write-down of $32.5 million relative to the depreciable production plant balance. The devaluation reflects the fact that although the utility in years past had offered the unit's capacity into the wholesale market, it now was using the plant's output solely in service to its retail customers. 

Among the other provisions highlighted by the commission was one that lets the company initiate a fiveyear electric vehicle (EV) charging station program, which the stipulation states must be implemented on a revenue-neutral basis. That is, the commission said, while the utility must include the costs and revenues of the EV project in its required quarterly reports to the commission, those costs will have no actual impact on customer bills. Re Gulf Power Co., Docket Nos. 160186-EI, 160170-EI, Order No. PSC-17-0178-S-EI, May 16, 2017 (Fla.P.S.C.).