JUNO BEACH, Fla.,
March 12, 2021 /PRNewswire/ -- Consistent with its preliminary
proposal announced in January, Florida
Power & Light Company (FPL) today filed a comprehensive
four-year request with the Florida Public Service Commission (PSC)
for new base rates that would be phased in beginning in 2022.
FPL now serves 5.6 million customer accounts from Miami to Pensacola across more than half of
Florida(1), a rapidly growing state on the front lines
of climate change and frequently severe weather. Recognizing this,
FPL's plan will enable the company to continue building a more
resilient and sustainable energy future for everyone – including
future generations – while keeping typical customer bills lower
than the national average through at least 2025.
"At FPL, we have a passion to deliver America's best energy
value and a commitment to do right by our customers, particularly
during these challenging times," said Eric
Silagy, president and CEO of FPL. "We recognize there is
never a good time to request a rate increase, and we remain
steadfastly committed to providing customers unparalleled value
while building an energy future they can depend on. Due to our
consistent and disciplined, long-term investments, we're able to
provide service that is cleaner and more reliable than ever before
while our residential, commercial and industrial bills have
remained among the lowest bills in the state and the nation for
over a decade. Our proposed four-year rate plan beginning in 2022
will help us continue delivering unmatched value to customers by
ushering in Florida's energy future and keeping bills among the
lowest in America."
With rates consistently well below the national average, FPL's
typical 1,000-kWh residential and business customer bills are lower
today than they were 15 years ago. As FPL's bill has decreased over
time, the service it provides customers has consistently and
demonstrably improved. FPL's investments to build a stronger,
smarter energy grid have resulted in best-in-state reliability
every year since 2006, as well as repeated national recognition. As
detailed in FPL's annual reliability report recently filed with the
PSC, FPL delivered its best-ever overall service reliability in
2020 and continued a trend in which FPL has improved reliability by
nearly 40% since 2006.
Aligned with previous multi-year plans approved by the
Commission, FPL has designed its new rate plan in a way that
provides exceptional customer value while strengthening the
company's commitment to disciplined and proven, long-term
investments in the infrastructure, innovative technology and clean
energy that are foundational for communities to continue to thrive.
Even with the plan's proposed base rate increase, FPL's typical
residential customer bills are projected to remain well below the
national average through 2025. FPL's typical business customer
bills are projected to be at or below the national average through
2025.
Delivering service efficiently
FPL ranks
best-in-class among all major U.S. utilities based on its low
operating and maintenance (O&M) costs per kWh of retail sales.
FPL's innovative and relentless day-to-day focus on driving costs
out of the business saves customers approximately $2.6 billion annually compared to an average
performing utility, which equates to savings of about $24 a month on a typical residential customer's
$99 bill – or nearly $300 annually. Never satisfied, FPL continues to
find new ways to work more efficiently to save customers money. For
example, FPL's 2022 non-fuel O&M, which is reflected in the
company's filing, is projected to be lower than FPL's 2018
best-in-class level.
The merger and consolidation of FPL and Gulf Power operations
will produce enormous benefits. Productivity improvements at Gulf
Power since its acquisition by NextEra Energy, FPL's parent
company, are expected to reduce annual O&M expenses in 2022 by
$86 million which, on a scale
adjusted basis, is the equivalent of saving nearly $1 billion at FPL. FPL also projects long-term
combined system benefits of approximately $1.53 billion as a result of power generation
upgrades already underway, a new transmission line physically
connecting both utility systems and the ability to dispatch from,
and plan for, a common fleet of power generation resources. In
total, combining the two companies and operating as a single
utility system is projected to save customers more than
$2.8 billion over the lifetime of the
assets.
The company is committed to operating efficiently in order to
deliver reliable service while keeping price increases low, even
while the costs of other essential products and services have risen
dramatically. For example, groceries, medical care, health
insurance and housing increased 25%-75% from 2006 to 2020.
Meanwhile, FPL's typical customer bill is approximately 10% lower
today than it was in 2006.
While FPL's focus on efficiency and productivity has lessened
the impact, the costs of many materials and products, such as
trucks, wire and employee healthcare, which the company must
purchase in order to provide clean, reliable and affordable power,
have increased. These increased expenses, together with the
increased investment required to serve approximately 500,000 new
customers from 2018 through the end of 2025 and to support
Florida's growing $1 trillion-plus
economy, are driving up the cost to provide service.
Overview of the proposed adjustments to revenue
requirements
FPL's proposal includes four adjustments to
base revenue requirements that would be phased in during the
four-year period, 2022-2025, providing customers continued,
longer-term cost certainty. Consistent with our initial estimate in
January, the plan includes:
- In 2022, an adjustment to base annual revenue requirements of
approximately $1.1 billion.
- In 2023, a subsequent year adjustment to base annual revenue
requirements of approximately $607
million.
- In 2024 and 2025, a request for a Solar Base Rate Adjustment
(SoBRA) mechanism to recover up to 894 megawatts (MW) of
cost-effective solar projects in each year. If the full amount of
new solar capacity allowed under the SoBRA proposal was
constructed, FPL's preliminary estimate is that it would result in
general base rate adjustments of approximately $140 million in 2024 and $140 million in 2025, which would be partially
offset by a reduction in fuel costs on the clause portion of
customer bills.
Investing in Florida's future
The phased-in rate
adjustments are necessary to help pay for the more than
$29 billion FPL will have invested
from 2019 through 2022 to benefit customers, including improving
electric service reliability, reducing emissions and improving
generation fuel efficiency, strengthening its electric system to
make it more resilient in severe weather and preparing for customer
growth. In addition, FPL will continue to make significant
investments throughout the base rate proposal timeframe to further
improve service for its customers.
- Investments to build a more resilient energy future: FPL
continues to build a stronger and smarter energy grid to further
improve service reliability for customers, including fewer outages
and restoring service faster. This includes:
-
- Continued deployment of advanced smart grid technology that
enables the company to continually monitor and assess the health of
its system, predict potential issues before they disrupt service to
customers and restore power faster following outages.
- Rebuilding the main 500-kV high-voltage electric transmission
line that serves as the backbone of Florida's energy grid.
- Construction of the North Florida Resiliency Connection, a new,
storm-hardened, state-of-the-art transmission line that physically
connects FPL's energy grid to Northwest
Florida.
- Investments to build a more sustainable energy future:
FPL is building more fuel-efficient power generation, solar and
energy storage facilities that drive down costs over the long term.
This includes:
-
- Solar: FPL's four-year rate plan includes adding more
solar to the energy grid through the company's "30-by-30" plan to
install 30 million solar panels in Florida by 2030.
- Energy storage: The plan includes building the world's
largest integrated solar-powered battery. It also includes an
innovative green hydrogen pilot project, a technology that could
one day unlock 100% carbon-free electricity that's available 24
hours a day.
- Ultra-efficient natural gas clean energy centers: As FPL
deploys leading edge, renewable technology, it's also committed to
meeting the 24/7 energy needs of customers today. The future FPL
Dania Beach Clean Energy Center – projected to enter service
in mid-2022 – will enable FPL to continue meeting customers'
growing energy needs while delivering more than $300 million in customer savings over its
operational lifetime. Additionally, FPL has modernized its power
plant in Northwest Florida,
converting it from coal to run entirely on clean natural gas –
cutting its carbon dioxide emissions rate by 40%.
- Anticipated growth of new customers: From 2018 through
the end of 2025 alone, the anticipated growth of approximately
500,000 new customers will require the addition of new
infrastructure and result in higher operating costs.
- Regulatory compliance: FPL will incur costs associated
with increased federal and state governmental and regulatory
reliability requirements, as well as cybersecurity costs to ensure
the company's assets and critical information, including customer
account records, are safeguarded.
Information for residential customers
Based on the
proposed base rate adjustments and the company's current
projections for fuel and other costs, FPL estimates that its
typical residential customer bill will grow at an average annual
rate of approximately 3.4% from January
2021 through 2025. Even with this growth, FPL estimates
that, through 2025, its typical residential bill will remain
approximately 20% below the projected national average and the
typical 1,000-kWh residential bill in Northwest Florida is projected to decrease by
the end of the four-year rate plan.
Combined with current projections for fuel and other costs,
FPL's four-year rate plan would phase in increases totaling about
$18 a month, or about 60 cents a day, on the typical 1,000-kWh
residential customer bill, phased in as follows:
- In 2022, a base rate adjustment, along with projections for
fuel and other costs, would add about $10.50 a month or about 35
cents a day on a typical bill.
- In 2023, a subsequent-year base rate adjustment, along with
projections for fuel and other costs, would add about $4 a month or about 13
cents a day on a typical bill.
- In 2024, a solar base rate adjustment, combined with
projections for fuel and other costs, would add about $2 a month or about 7
cents a day on a typical bill.
- In 2025, a solar base rate adjustment would add $1.50 a month or about 5
cents a day on a typical bill.
Most FPL customers power their homes for just a few dollars a
day. FPL's residential customer monthly usage median is
approximately 950 kWh, which means that the majority of FPL
customer households consume less than the standard 1,000-kWh
typical bill benchmark, which is about $99 as of January
2021.
In recognition of the initial difference in the costs of serving
the existing FPL and Gulf Power customers, FPL is proposing a
transition rider/credit mechanism to address those differences in a
reasonable manner for all customers. The transition rider/credit
would decline to zero over a five-year period, at which point rates
would be fully aligned by Jan. 1,
2027.
To estimate what the proposed rates would mean for their own
bills based on individual electricity usage, FPL and Gulf Power
residential customers can visit the online calculator at
www.FPL.com/answers and www.GulfPower.com/answers. In addition to
the calculator, customers can find more information on FPL's
four-year base rate proposal.
FPL Bills – 2006,
2021 & 2022-2025
|
Jan. 2006
|
$108.61
|
Jan. 2021
|
$99.05
|
Jan. 2022
|
$109.58
|
Jan. 2023
|
$113.49
|
Jan. 2024
|
$115.61
|
Jan. 2025
|
$117.06
|
"Jan. 2006"
reflects FPL rates in effect during the year 2006. "Jan. 2021"
reflects FPL rates for Jan. 2021. "Jan. 2022-2025" reflects the
current projection for FPL's typical 1,000-kWh customer bill from
2022-2025, which includes projected base rate adjustments, as well
as current projections for fuel and other clauses. All bill totals
include the state's standard gross receipts tax, but do not include
any local taxes or fees that vary by community. FPL bills do not
include the company's Gulf Power region. All rates are subject to
change.
|
|
Northwest Florida
Bills – 2006, 2021 & 2022-2025
|
Jan. 2006
|
$92.48
|
Jan. 2021
|
$132.41
|
Jan. 2022
|
$133.21
|
Jan. 2023
|
$132.39
|
Jan. 2024
|
$129.79
|
Jan. 2025
|
$126.50
|
"Jan. 2006"
reflects Gulf Power rates in effect during the year 2006. "Jan.
2021" reflects Gulf Power rates for Jan. 2021. "Jan. 2022-2025"
reflects the current projection for the typical 1,000-kWh customer
bill in Northwest Florida from 2022-2025, which includes projected
base rate adjustments as well as current projections for fuel and
other clauses. All bill totals include the state's standard gross
receipts tax but do not include any local taxes or fees that vary
by community. Bills also do not include surcharges for hurricanes.
All rates are subject to change.
|
Information for business customers
FPL business
customers' typical bills are lower today than they were 15 years
ago and are well below the national average. The proposed base rate
adjustments vary widely depending on rate class and customer usage.
For small and medium businesses, typical bills are projected to
grow at an average annual rate of about 3.9% to 4.4% from
January 2021 through 2025. Even with
the proposed increase, small and medium business customer bills
will remain well below the national average through 2025.
Large commercial and industrial customers with more complex rate
structures may contact their FPL account managers for information
about their proposed rate adjustments.
The estimates above are based on the company's filed proposal
and may change. In the coming months, the PSC is expected to
conduct an extensive review of the request.
Florida Power & Light
Company
Florida Power &
Light Company is the largest energy company in the U.S. as measured
by retail electricity produced and sold. The company serves more
than 5.6 million customer accounts supporting more than 11 million
residents across Florida with clean, reliable and affordable
electricity. FPL operates one of the cleanest power generation
fleets in the U.S and in 2020 won the
ReliabilityOne® National Reliability Excellence Award, presented by
PA Consulting, for the fifth time in the last six years. The
company was recognized in 2020 as one of the most trusted U.S.
electric utilities by Escalent for the seventh consecutive year.
FPL is a subsidiary of Juno Beach,
Florida-based NextEra Energy, Inc. (NYSE: NEE), a clean
energy company widely recognized for its efforts in sustainability,
ethics and diversity, and has been ranked No. 1 in the electric and
gas utilities industry in Fortune's 2021 list of "World's Most
Admired Companies." NextEra Energy is also the parent company of
NextEra Energy Resources, LLC, which, together with its affiliated
entities, is the world's largest generator of renewable energy from
the wind and sun and a world leader in battery storage. For more
information about NextEra Energy companies, visit these websites:
www.NextEraEnergy.com, www.FPL.com,
www.NextEraEnergyResources.com.
Cautionary Statements and Risk Factors That May Affect Future
Results
This news release contains "forward-looking statements" within
the meaning of the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements are not
statements of historical facts, but instead represent the current
expectations of NextEra Energy, Inc. (NextEra Energy) and
Florida Power & Light Company
(FPL) regarding future operating results and other future events,
many of which, by their nature, are inherently uncertain and
outside of NextEra Energy's and FPL's control. In some cases, you
can identify the forward-looking statements by words or phrases
such as "will," "may result," "expect," "anticipate," "believe,"
"intend," "plan," "seek," "potential," "projection," "forecast,"
"predict," "goals," "target," "outlook," "should," "would" or
similar words or expressions. You should not place undue reliance
on these forward-looking statements, which are not a guarantee of
future performance. The future results of NextEra Energy and FPL
and their business and financial condition are subject to risks and
uncertainties that could cause their actual results to differ
materially from those expressed or implied in the forward-looking
statements, or may require them to limit or eliminate certain
operations. These risks and uncertainties include, but are not
limited to, those discussed in this news release and the following:
effects of extensive regulation of NextEra Energy's and FPL's
business operations; inability of NextEra Energy and FPL to recover
in a timely manner any significant amount of costs, a return on
certain assets or a reasonable return on invested capital through
base rates, cost recovery clauses, other regulatory mechanisms or
otherwise; impact of political, regulatory and economic factors on
regulatory decisions important to NextEra Energy and FPL;
disallowance of cost recovery by FPL based on a finding of
imprudent use of derivative instruments; effect of any reductions
or modifications to, or elimination of, governmental incentives or
policies that support utility scale renewable energy projects of
NextEra Energy Resources, LLC and its affiliated entities (NextEra
Energy Resources) or the imposition of additional tax laws,
policies or assessments on renewable energy; impact of new or
revised laws, regulations, interpretations or ballot or regulatory
initiatives on NextEra Energy and FPL; capital expenditures,
increased operating costs and various liabilities attributable to
environmental laws, regulations and other standards applicable to
NextEra Energy and FPL; effects on NextEra Energy and FPL of
federal or state laws or regulations mandating new or additional
limits on the production of greenhouse gas emissions; exposure of
NextEra Energy and FPL to significant and increasing compliance
costs and substantial monetary penalties and other sanctions as a
result of extensive federal regulation of their operations and
businesses; effect on NextEra Energy and FPL of changes in tax
laws, guidance or policies as well as in judgments and estimates
used to determine tax-related asset and liability amounts; impact
on NextEra Energy and FPL of adverse results of litigation; effect
on NextEra Energy and FPL of failure to proceed with projects under
development or inability to complete the construction of (or
capital improvements to) electric generation, transmission and
distribution facilities, gas infrastructure facilities or other
facilities on schedule or within budget; impact on development and
operating activities of NextEra Energy and FPL resulting from risks
related to project siting, financing, construction, permitting,
governmental approvals and the negotiation of project development
agreements; risks involved in the operation and maintenance of
electric generation, transmission and distribution facilities, gas
infrastructure facilities, retail gas distribution system in
Florida and other facilities;
effect on NextEra Energy and FPL of a lack of growth or slower
growth in the number of customers or in customer usage; impact on
NextEra Energy and FPL of severe weather and other weather
conditions; threats of terrorism and catastrophic events that could
result from terrorism, cyberattacks or other attempts to disrupt
NextEra Energy's and FPL's business or the businesses of third
parties; inability to obtain adequate insurance coverage for
protection of NextEra Energy and FPL against significant losses and
risk that insurance coverage does not provide protection against
all significant losses; a prolonged period of low gas and oil
prices could impact NextEra Energy Resources' gas infrastructure
business and cause NextEra Energy Resources to delay or cancel
certain gas infrastructure projects and could result in certain
projects becoming impaired; risk to NextEra Energy Resources of
increased operating costs resulting from unfavorable supply costs
necessary to provide NextEra Energy Resources' full energy and
capacity requirement services; inability or failure by NextEra
Energy Resources to manage properly or hedge effectively the
commodity risk within its portfolio; effect of reductions in the
liquidity of energy markets on NextEra Energy's ability to manage
operational risks; effectiveness of NextEra Energy's and FPL's risk
management tools associated with their hedging and trading
procedures to protect against significant losses, including the
effect of unforeseen price variances from historical behavior;
impact of unavailability or disruption of power transmission or
commodity transportation facilities on sale and delivery of power
or natural gas by NextEra Energy, including FPL; exposure of
NextEra Energy and FPL to credit and performance risk from
customers, hedging counterparties and vendors; failure of NextEra
Energy or FPL counterparties to perform under derivative contracts
or of requirement for NextEra Energy or FPL to post margin cash
collateral under derivative contracts; failure or breach of NextEra
Energy's or FPL's information technology systems; risks to NextEra
Energy and FPL's retail businesses from compromise of sensitive
customer data; losses from volatility in the market values of
derivative instruments and limited liquidity in OTC markets; impact
of negative publicity; inability of FPL to maintain, negotiate or
renegotiate acceptable franchise agreements with municipalities and
counties in Florida; occurrence of
work strikes or stoppages and increasing personnel costs; NextEra
Energy's ability to successfully identify, complete and integrate
acquisitions, including the effect of increased competition for
acquisitions; environmental, health and financial risks associated
with NextEra Energy Resources' and FPL's ownership and operation of
nuclear generation facilities; liability of NextEra Energy and FPL
for significant retrospective assessments and/or retrospective
insurance premiums in the event of an incident at certain nuclear
generation facilities; increased operating and capital expenditures
and/or reduced revenues at nuclear generation facilities of NextEra
Energy or FPL resulting from orders or new regulations of the
Nuclear Regulatory Commission; inability to operate any of NextEra
Energy Resources' or FPL's owned nuclear generation units through
the end of their respective operating licenses; effect of
disruptions, uncertainty or volatility in the credit and capital
markets or actions by third parties in connection with
project-specific or other financing arrangements on NextEra
Energy's and FPL's ability to fund their liquidity and capital
needs and meet their growth objectives; inability of NextEra
Energy, FPL and NextEra Energy Capital Holdings, Inc. to maintain
their current credit ratings; impairment of NextEra Energy's and
FPL's liquidity from inability of credit providers to fund their
credit commitments or to maintain their current credit ratings;
poor market performance and other economic factors that could
affect NextEra Energy's defined benefit pension plan's funded
status; poor market performance and other risks to the asset values
of NextEra Energy's and FPL's nuclear decommissioning funds;
changes in market value and other risks to certain of NextEra
Energy's investments; effect of inability of NextEra Energy
subsidiaries to pay upstream dividends or repay funds to NextEra
Energy or of NextEra Energy's performance under guarantees of
subsidiary obligations on NextEra Energy's ability to meet its
financial obligations and to pay dividends on its common stock; the
fact that the amount and timing of dividends payable on NextEra
Energy's common stock, as well as the dividend policy approved by
NextEra Energy's board of directors from time to time, and changes
to that policy, are within the sole discretion of NextEra Energy's
board of directors and, if declared and paid, dividends may be in
amounts that are less than might be expected by shareholders; NEP's
inability to access sources of capital on commercially reasonable
terms could have an effect on its ability to consummate future
acquisitions and on the value of NextEra Energy's limited partner
interest in NextEra Energy Operating Partners, LP; effects of
disruptions, uncertainty or volatility in the credit and capital
markets on the market price of NextEra Energy's common stock; and
the ultimate severity and duration of public health crises,
epidemics and pandemics, including the coronavirus pandemic, and
its effects on NextEra Energy's or FPL's businesses. NextEra Energy
and FPL discuss these and other risks and uncertainties in their
annual report on Form 10-K for the year ended December 31, 2020 and other SEC filings, and this
news release should be read in conjunction with such SEC filings.
The forward-looking statements made in this news release are made
only as of the date of this news release and NextEra Energy and FPL
undertake no obligation to update any forward-looking
statements.
- On Jan. 1, 2021, Gulf Power,
which serves customers in Northwest
Florida, legally combined with FPL. Gulf Power will continue
as a separate operating division under the Gulf Power name through
2021.
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SOURCE Florida Power & Light
Company