Supreme Court Rebuffs Consumer Advocate Challenge of FPL’s $350 Million Rate Hike
FlaglerLive | August 28, 2014
Saying it gives “great deference” to utility regulators, the state Supreme Court on Thursday unanimously rejected a challenge to rate increases approved in 2012 for Florida Power & Light.
The state Office of Public Counsel, which represents consumers in utility issues, fought the rate increases that stemmed from a deal reached by FPL and some major power users. The Florida Public Service Commission approved a $350 million base-rate increase, along with plans for additional increases tied to three new power plants.
The public counsel contended, in part, that the Public Service Commission did not follow the proper process in reviewing and approving the hikes. Also, as the representative of consumers, the public counsel took issue with approval of a settlement that it adamantly opposed.
But the Supreme Court, in a 63-page opinion written by Chief Justice Jorge Labarga, flatly rejected the public counsel’s arguments. The court said it has consistently given “great deference” to the Public Service Commission’s findings in such cases and that state law doesn’t prevent the commission from approving settlements that lack unanimous support from the parties involved, including the Office of Public Counsel.
“Here … the OPC (Office of Public Counsel) fully represented citizens in 10 days of hearings regarding FPL’s petition for a rate increase and also fully participated in hearings regarding the proposed settlement agreement by submitting pre-filed testimony, participating in discovery, presenting evidence in opposition to the settlement agreement, and filing post-hearing briefs,” the opinion said. “Thus, the OPC was not precluded from zealously representing citizens, but was provided multiple opportunities to urge the public’s position on FPL’s petition and subsequent settlement agreement.”
FPL President and Chief Executive Officer Eric Silagy issued a statement praising the Supreme Court decision and said the 2012 settlement has benefited customers.
“We’re extremely pleased by the court’s unanimous decision, which affirms an important rate agreement that was developed and supported by key customer advocacy groups and thoroughly examined by the PSC,” Silagy said.
Proposals to raise base electric rates are highly complex and play out over several months before the Public Service Commission. Also, base-rate cases typically involve a number of parties, as groups such as large commercial power users intervene.
FPL filed a base-rate request in March 2012, but it reached the settlement agreement in August 2012 with the Florida Industrial Power Users Group, the South Florida Hospital & Healthcare Association and federal-government agencies — all of which represent large electricity users.
The settlement, which changed terms of FPL’s original request, drew immediate fire from the Office of Public Counsel and was opposed by another party in the case, the Florida Retail Federation. Among other things, the public counsel had long contended that FPL’s base rates should decrease, not increase, in 2013.
The Public Service Commission gave approval in December 2012 to the settlement after making some tweaks. The base-rate increases took effect in January 2013, with the additional increases tied to new power plants starting to operate at Cape Canaveral, Riviera Beach and Port Everglades.
–Jim Saunders, News Service of Florida