Court won't block PSC from considering FPL settlement

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An appeals court late Thursday rejected an effort to block the state Public Service Commission from considering a controversial settlement proposal in a rate case filed by Florida Power & Light.

The 1st District Court of Appeal denied a petition filed by the state Office of Public Counsel, which represents consumers in utility cases and opposes the proposed settlement hammered out by FPL and groups of large electricity users. The Public Service Commission is scheduled to start a detailed hearing on the proposal Monday.

The Office of Public Counsel took the highly unusual step last month of asking the Florida Supreme Court to block consideration of the settlement proposal. Earlier Thursday, the Supreme Court sent the dispute to the appeals court, with an instruction to “expedite consideration of the petition as it appears to be time-sensitive based upon the allegations.”

A three-judge panel of the appeals court issued the opinion Thursday but did not explain its reasoning for denying the petition.

The dispute stems from a base-rate case that FPL filed early this year and a proposed settlement it reached in August with the Florida Industrial Power Users Group, a business organization that frequently intervenes in utility cases, the South Florida Hospital and Healthcare Association and federal agencies that are large power customers.

The Office of Public Counsel contends that the settlement proposal is invalid, in part, because the office — as the representative of the broader FPL customer base — is opposed to it. Also, it argued that the settlement proposal includes substantial differences from FPL’s original rate filing, effectively making it like a new rate case.

In the original rate filing, FPL proposed increasing rates by $690.4 million in 2013. The utility and other parties spent months preparing for a PSC hearing on that proposal. But in August, shortly before the hearing, FPL and the major power users proposed the settlement.

The settlement would increase base rates by $378 million next year and allow FPL to collect additional money in the coming years to cover costs related to new power plants. The Office of Public Counsel also has said the settlement proposal includes rate concessions for major power users that would have to be offset by other customers, including residential customers.

The Office of Public Counsel argues that FPL’s base rates should drop — not increase — next year. Regulators have not made a decision about FPL’s original $690.4 million proposal but have scheduled a three-day hearing next week on the settlement plan. It is unclear how regulators will then resolve the proposals.

An FPL spokesman said last month that the Office of Public Counsel refused to take part in a negotiating process that led to a “thoughtful compromise that provides benefits for all customers.” The utility also said the Public Service Commission is within its rights to conduct the hearing next week.

Despite sending the case Thursday to the appeals court, the Supreme Court left open the possibility that the Office of Public Counsel could file another challenge if the settlement proposal is ultimately approved by the Public Service Commission.

Via Jim Saunders of the News Service of Florida.

Peter Schorsch is the President of Extensive Enterprises and is the publisher of some of Florida’s most influential new media websites, including SaintPetersBlog.com, FloridaPolitics.com, ContextFlorida.com, and Sunburn, the morning read of what’s hot in Florida politics. SaintPetersBlog has for three years running been ranked by the Washington Post as the best state-based blog in Florida. In addition to his publishing efforts, Peter is a political consultant to several of the state’s largest governmental affairs and public relations firms. Peter lives in St. Petersburg with his wife, Michelle, and their daughter, Ella.