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Public counsel asks high court to reject FPL's rate hike settlement as unlawful

The lawyers representing the public in utility rate cases are asking the Florida Supreme Court to reject the decision by state utility regulators to allow Florida Power & Light to raise its rates through a settlement agreement opposed by the Office of Public Counsel.

The one-page appeal was filed Thursday by Public Counsel JR Kelly, an action he anticipated when the Public Service Commission unanimously approved an agreement in December to give the company $350 million more a year, and allows for two additional increases in the next four years.

The PSC approved the settlement over the objections of Kelly, who by law represents ratepayers in cases before the utility board. He vigorously objected to the settlement as a one-sided bad deal for customers and said it violated the that violates regulator’s rules for reaching settlements. 

FPL spokesman Mark Bubriski would not comment on the legal challenge except to say in a statement that the settlement "benefits all customers of FPL by enabling the utility to continue to deliver excellent reliability, industry-leading clean power, award-winning customer service and the lowest typical residential customer bills in Florida.” He also issued this document:  Download 2013 Fact Sheet on Approved Settlement

FPL side-stepped the public counsel when it entered into its agreement with Florida Industrial Power Users Group, the South Florida Hospital and Healthcare Association and the Federal Executive Agencies just as the company’s rate case was scheduled to begin in August. 

Under the rate agreement, customers will not see their bills increase until June, as a drop in fuel costs absorbs most of the rate increase. In January, the typical residential customer who uses 1,000 kilowatt hours of electricity a month will see his bill drop about 37 cents a month to about $94.25 as a $4.13 decrease in fuel charges offsets the $3.76 base rate increase.  
In June, when the company puts into service its Cape Canaveral power plant, it will be allowed to raise rates again, this time increasing rates about $1 per month for the 1,000 kilowatt hour per month customer. The company will raise rates an estimated $2 more per month in 2014 and about $2 again in 2016 as power plants in Rivera Beach and Port Everglades come online. None of the rate changes will require PSC approval.

One of the simmering issues throughout the settlement talks was the question of whether FPL was sincere in its attempts to open a dialogue with the Office of Public Counsel or not. FPL president Eric Silagy told the Miami Herald's editorial board on Monday that he personally went to Kelly to ask him to join the settlement talks but was told to wait until after the commission helds its quality service hearings over the rate case.

"There was never an interest in engaging in the conversation,'' Silagy said. "At that point others in the process decided they wanted to reach out…We started a dialogue with them.''

Kelly has said, however, that he was asked to engage in the settlement talks only after an agreement had been reached by the other parties. 

"I was disappointed we were not able to have a more productive dialogue,'' Silagy told the editorial board. "…When you look at the amount of review and debate that went through the process we would have benefitted from public counsel being engaged in the process rather than saying they are not going to participate."