Florida Trend | Florida's Business Authority

Utilities get backing on natural gas costs

Tampa Electric Co. and Duke Energy Florida should be able to raise customer bills in September to cover higher-than-expected natural gas costs, according to recommendations by staff members of the Florida Public Service Commission.

The utilities, which have a combined total of about 2.7 million customers, would pass along the tens of millions of dollars in higher costs to customers from September through December. The Public Service Commission will take up the proposals during a meeting Tuesday.

The commission annually approves projected fuel costs that are baked into customer bills. But if actual costs appear headed toward exceeding projections by more than 10 percent --- what is known as an “under-recovery” --- utilities can ask for mid-year changes to increase the amounts charged to customers.

The Public Service Commission generally approves such requests, though utilities have to eventually show how much they spent on fuel and pass back any excess amounts to customers.

Tampa Electric and Duke filed their proposals this month, citing costs of natural gas needed to fuel power plants.

The commission staff recommendations issued Tuesday said Tampa Electric residential customers who use 1,000 kilowatt hours of electricity a month would see their monthly bills increase $12.82 from September through December, under the company’s proposal.

Similar Duke customers would see $4.28-a-month increases.

The utility industry uses 1,000 kilowatt-hour residential bills as a benchmark, though actual power consumption varies widely. Also, commercial rates are calculated differently.