The Florida Public Service Commission (PSC) will proceed Tuesday with a hearing to finalize recently adopted rules that require electrical utilities to develop 10-year “storm protection plans” despite objections over vagaries that could lead to “double-billing” and calls to allow more time for review.
The state’s Office of Public Counsel (OPC), which requested the hearing after the PSC unanimously approved the storm-hardening program’s rules on Oct. 3, last week asked for a continuance of the hearing to allow “affected persons a real opportunity to present all of their objections and concerns to the commissioners, including essential facts required to protect the customers’ interests.”
The OPC, noting the PSC unanimously approved the rules over its own staff’s recommendations, sought to reschedule Tuesday’s hearing and reframe it as an “evidentiary” hearing to include depositions and testimony from experts.
“The substantial interests of the citizens require that these complex issues be presented and resolved after holding the rule-making hearing in abeyance and conducting a formal proceeding to determine essential, but missing, facts … including an evidentiary hearing where experts for the utilities and the customers can, after conducting discovery, present their sworn testimony, subject to cross-examination, and file post-hearing briefs,” OPC’s filing said.
PSC Chair Art Graham dismissed the request two days later.
“The driving force behind OPC’s motion for continuance appears to be its desire to conduct discovery” in an evidentiary hearing, Graham wrote, noting state law “does not contemplate discovery in rule-making proceedings. OPC appears to be conflating rule-making proceedings under [state statute], with proceedings to determine the substantial interests of a party.”
The OPC, advocacy groups and individual rate-payers – dozens have posted public comments on the proposed rules – claim the PSC is needlessly fast-tracking game-changing rules that will affect the electric bills of approximately 9 million Investor Owned Utilities’ (IOUs) customer accounts in Florida.
The new rules implement Senate Bill 796, adopted during the 2019 legislative session, that encourages building more underground power lines to make Florida’s electrical grid more resilient to hurricanes.
SB 796 changes how projects under the “Storm Protection Plan” program are financed and authorizes a new rate-payer surcharge to be approved annually by the PSC.
The OIR and ratepayer advocates, such as Kelly Cisarik, an Indian Rocks Beach real estate broker, maintain utilities already incorporate capital improvement costs into base rates, which are approved for multi-year spans and include a range of fees, taxes and surcharges.
Utilities can “approve these under-grounding projects and they don’t have to wait for [money] and be reimbursed later,” Cisark told TCS Monday. “They can get it upfront; they are getting paid on projects year two and three years in advance.”
But the rules adopted by the PSC, she said, offer “great potential” for “abuse that could lead to unnecessarily high costs that will be passed on to ratepayers.”
The “Storm Protection Plan” surcharge won’t be clearly identified on bills but will be “blended in under the line for ‘Fuel Charge,’” Cisarik said. “Customers will see their bills go up in two, three years, but they likely won’t know why.”
Under SB 796, utilities must file 10-year storm-hardening plans. The PSC granted utilities’ request to provide detailed project information just for the first year, and only require broad program information for the second and third years.
Utilities, including attorneys for Florida Power & Light, convinced the PSC that the second and third years of the inaugural 10-year plans must be flexible as utilities learn what works best in the program’s roll out.
Under the “FPL amendment,” the utilities will return to the PSC annually to approve proposed detailed project plans for the next year – and submit potential surcharge hikes to pay for them.
The OPS maintains the vagaries of the program’s second and third years could allow utilities to collect money for projects already being paid for by customers’ base rates and storm recovery surcharges.
“The proposed rules, as drafted, do not ensure that the ratepayers will not pay twice for storm protection and hardening as required by the statute,” the OPC stated in its denied motion for a continuance.