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May 24, 2018

Press Release

FPL to apply federal tax savings toward $1.3 billion cost of Hurricane Irma to prevent increase in customer rates

| 1/18/2018
  • Because of federal tax savings beginning in 2018, FPL will not need to raise rates to pay for the unprecedented Hurricane Irma restoration - saving each of FPL's 4.9 million customers an average of $250
  • Already among the lowest in the nation, FPL's typical 1,000-kWh customer bill also will drop to nearly 30 percent below the latest national average with a decrease of $3.35 a month that will take effect March 1 with the completion of Hurricane Matthew recovery
  • Tax savings in future years may enable FPL to continue the current rate agreement and avoid a general base rate increase potentially through the end of 2022

JUNO BEACH -- Florida Power & Light Company today announced that customers will not pay a surcharge for Hurricane Irma restoration as previously expected. Instead, FPL plans to apply federal tax savings toward the $1.3 billioncost of Hurricane Irma restoration, which will save each of FPL's 4.9 million customers an average of approximately $250.

In addition, FPL may be able to use future federal tax savings to continue operating under the current base rate agreement beyond the initial term, which covers through 2020, for up to two additional years.

"The timing of federal tax reform, coming on the heels of the most expensive hurricane in Florida history, created an unusual and unprecedented opportunity. We believe the plan we've outlined is the fastest way to begin passing tax savings along to our customers and the most appropriate approach to keeping rates low and stable for years to come," said Eric Silagy, president and CEO of FPL.

Hurricane Irma was one of the largest, most powerful storms to ever hit Florida, and FPL's response was unprecedented both in scale and the speed of power restoration. The company had previously announced its intention to begin recovering the $1.3 billionrestoration cost by implementing a surcharge on customer bills through 2020.

The ability to leverage the federal tax savings in this way is afforded by FPL's current base rate agreement, which was negotiated with the Office of Public Counsel and other customer groups and approved unanimously by the Florida Public Service Commission in 2016. The agreement set parameters for base rates and storm surcharges from 2017 through at least 2020.

"Our current rate agreement provides the ability to use federal tax savings to entirely offset Hurricane Irma restoration costs, which delivers an immediate benefit to customers, and also the potential opportunity to avoid a general base rate increase for up to an additional two years," Silagy said.

Keeping customer bills low 
While the prices of almost all products and services have risen in recent years, FPL's typical 1,000-kWh residential customer bill has remained very low. In fact, FPL's typical bill is lower today than it was more than 10 years ago.

Already among the lowest in the nation, FPL's typical 1,000-kWh customer bill will drop to nearly 30 percent below the latest national average with a decrease of $3.35 a month that will take effect March 1 with the completion of the recovery of costs for Hurricane Matthew.


FPL's Typical 1,000-kWh Customer Bill

2006

Current

Beginning

March 1, 2018

$108.61

$102.72

$99.37

As of March 1, FPL's typical bill will be approximately 15% lower than the state average and 29% lower than the U.S. average, according to the latest available data.

Sources: State average ($116.61) reflects November 2017 bills reported by 42 Florida electric utilities; U.S. average ($139.86) is based on Summer 2017 bills from 175 utilities, published by the Edison Electric Institute.

 

Florida Power & Light Company

Florida Power & Light Company is the third-largest electric utility in the United States, serving nearly 5 million customer accounts or an estimated 10 million people across nearly half of the state of Florida. FPL's typical 1,000-kWh residential customer bill is approximately 25 percent lower than the latest national average and, in 2016, was the lowest in Florida among reporting utilities for the seventh year in a row. FPL's service reliability is better than 99.98 percent, and its highly fuel-efficient power plant fleet is one of the cleanest among all utilities nationwide. The company received the top ranking in the southern U.S. among large electric providers, according to the J.D. Power 2016 Electric Utility Residential Customer Satisfaction StudySM, and was recognized in 2017 as one of the most trusted U.S. electric utilities by Market Strategies International. A leading Florida employer with approximately 8,900 employees, 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 2017 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. For more information about NextEra Energy companies, visit these websites: www.NextEraEnergy.comwww.FPL.com,www.NextEraEnergyResources.com.

 

Tags: Energy & Utilities

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