AARP Florida: We're Disappointed in House Vote AARP Florida: We’re Disappointed in House Vote To Charge Florida Electric Ratepayers for Out-of-State Natural Gas Projects

St. Petersburg, Fla. – AARP Florida Advocacy Manager Jack McRay said AARP is disappointed in a 9-6 House committee vote Tuesday to allow Florida investor-owned utilities to shift the cost of out-of-state natural-gas exploration and development projects to ratepayers, while simultaneously collecting a return for itself on ratepayer-funded costs.

The House Energy and Utilities subcommittee voted Tuesday to approve House Bill 1043 by Rep. Jason Brodeur, R-Sanford, in a subcommittee meeting held specifically to consider the legislation, just ahead of a legislative deadline for committees to consider pending legislation.  The bill was placed on the agenda for the meeting late Friday.

"It is a basic free-market principle that if you bear the risk, you deserve the reward,” McRay said.  “This legislation turns that principle on its head.  The legislation asks ratepayers to foot the bill for risky utility company exploration projects in other states.  Whether the project succeeds or fails, the utility company still gets to collect a return on the ratepayers’ investment – a return of as much as 11.5 percent.  This legislation is a prime example of intervening in the marketplace to pick winners and losers – and AARP believes ratepayers would be the losers.”

The bill next moves to the full House Commerce Committee.  A Senate version of the legislation, SB 1238, has received fast-track consideration and passed unanimously out of the Senate Communications, Energy and Public Utilities Committee with little discussion.

The legislation would allow a Florida investor-owned utility company that produces at least 65 percent of its electricity from natural gas to charge ratepayers, rather than its own investors, to drill for natural gas in projects out of state.  Florida Power & Light Co. meets this definition.

The legislation would have the effect of overriding a Florida Supreme Court decision in May 2016 that blocked FPL from using ratepayer money to drill for natural gas in Oklahoma.  The Florida Public Service Commission (PSC) had voted to allow FPL to use ratepayer money to finance the Oklahoma drilling project.  AARP filed a friend-of-the-court brief in a Supreme Court appeal of the PSC decision.  Earlier this year, the PSC voted to give Florida Power & Light a $811 million rate increase.