State Supreme Court Asked To Unplug FP&L Rate Hikes

TALLAHASSEE (CBSMiami/NSF) — Florida's Supreme Court is being asked to overturn a rate increase approved last year for the state's largest utility, Florida Power & Light.

The state Office of Public Counsel, which by law represents consumers in utility issues, contends that the Florida Public Service Commission approved the increases without going through the proper process. Also, the Office of Public Counsel takes issue with a settlement that set the stage for the hikes --- a settlement that the public counsel vehemently opposed.

Justices questioned attorneys on both sides about a complicated series of events that led to the rate increases, with Justice Barbara Pariente asking at one point how a settlement could be reached that did not include the public counsel. She likened the public counsel's role to representing the "99 percent" of FPL customers, while major commercial electricity users that agreed to the settlement were "1 percent."

"Aren't we talking about the rest of the residential users who are going to be affected by this?" Pariente asked.

But attorneys for the Public Service Commission and FPL said the public counsel was able last year to contest issues before regulators approved the settlement. Also, the public counsel declined to participate in the settlement while it was being drawn up.

"This was not sprung on public counsel at the last minute,'' FPL attorney Alvin B. Davis said.

The Public Service Commission, which regulates utilities and approves rates, agreed late last year to allow FPL to raise base electric rates by $350 million in January 2013. Also, it agreed to allow the utility to raise rates again as three new power plants started operating over a four-year period.

Base-rate increases are often a contentious issue and take months to play out, as utilities and other parties submit large amounts of financial and technical information to the Public Service Commission.

Average residential customers would see an increase of more than $9 a month through 2016, although utility officials say efficiencies associated with new plants will result in just under $3 a month over the same time period.

Florida Power & Light has roughly 4.6 million customers in the state.

There is no timeline for the justices to rule on the case even though the rate hike has already taken effect.

"The News Service of Florida contributed to this report."