AARP Florida: Don't Make Customers Pay for Electric Company Wildcatting Ventures

Tallahassee, Fla.  – AARP Florida will oppose legislative proposals that would allow Florida electric utility companies, including Florida Power & Light, to use residential customers’ money to finance exploration and drilling ventures seeking natural gas in other states.

AARP’s Florida advocacy manager, Jack McRay, announced AARP’s position in remarks before the Florida Senate Communications, Energy and Public Utilities committee Tuesday.  The committee is one of several state legislative committees considering SB 1238, by Sen. Aaron Beach, R-Jacksonville. Its companion bill is House Bill 1043.

The legislation seeks to overturn a Florida Supreme Court ruling in 2014, which had blocked a Florida Public Service Commission decision earlier to allow Florida Power & Light to use ratepayers’ money to finance natural-gas exploration in Oklahoma.  The legislation allows any Florida electric utility that uses natural gas for 65 percent or more of its power generation to explore for natural gas out of state using residential ratepayer’s money.

In remarks prepared for the committee, McRay noted that:

• The legislation would let electric companies take hundreds of millions of dollars per year from ratepayers and use them to finance out-of-state natural-gas exploration projects. Spending Florida dollars out of state won’t help Florida’s economy.
• By considering the fracking projects paid for with ratepayers’ dollars as investments, utility companies could earn a return on the investment.  In the case of Florida Power & Light, the return could be as high as 11.5 percent.  If the utility company simply purchased natural gas on the open market, the utility could recover the cost of the fuel from ratepayers but could not earn an additional “windfall.”
• If the legislation becomes law and the state Public Service Commission allows utility companies to raise rates, ratepayers would be hit with yet another rate increase. Earlier this year, the PSC approved two rate increases for the state’s largest utility, FPL.  A $1.3 billion rate increase earlier this year allowed FPL a higher rate of return on basic electric service, and a separate PSC decision allowed the company to recover repair costs for Hurricane Matthew.
• No other state that regulates investor-owned utilities has allowed electric companies to charge ratepayers for natural-gas drilling and exploration projects.

AARP urged residential ratepayers and AARP members to contact state legislators to urge them to oppose the legislation.

Here is how to contact members of the committee:

Representative	Party	District	Phone	Email
Kathleen Peters (Chair)	(R)	69	850.717.5069	Kathleen.Peters@myfloridahouse.gov
Eric Eisnaugle (Vice Chair)	(R)	44	850.717.5044	Eric.Eisnaugle@myfloridahouse.gov
Lori Berman	(D)	90	805.717.5090	lori.berman@myfloridahouse.gov
Bryan Avila	(R)	111	850.717.5111	Bryan.Avila@myfloridahouse.gov
Kimberly Daniels	(D)	14	850.717.5014	Kimberly.Daniels@myfloridahouse.gov
Bobby DuBose	(D)	94	850.717.5094	Bobby.DuBose@myfloridahouse.gov
Nicholas Duran	(D)	112	850.717.5112	Nicholas.Duran@myfloridahouse.gov
Jason Fischer	(R)	16	850.717.5016	Jason.Fischer@myfloridahouse.gov
Erin Grall	(R)	54	850.717.5054	Erin.Grall@myfloridahouse.gov
Joe Gruters	(R)	73	850.717.5073	Joe.Gruters@myfloridahouse.gov
Stan McClain	(R)	23	850.717.5023	Stan.McClain@myfloridahouse.gov
Bobby Payne	(R)	19	850.717.5019	bobby.payne@myfloridahouse.gov
Sean Shaw	(D)	61	850.717.5061	Sean.Shaw@myfloridahouse.gov
Jackie Toledo	(R)	60	850.717.5060	Jackie.Toledo@myfloridahouse.gov
Frank White	(R)	2	850.717.5002	frank.white@myfloridahouse.gov