Duke Energy Florida Files for April Rate Cut

by | Feb 18, 2016

For the fourth time in three years, Duke Energy Florida’s 1.7 million natural gas customers will see lower rates, if plans are approved by the Florida Public Service Commission (FPSC).

The utility filed a request (Docket No. 160001-EI) with the FPSC on February 8 for a mid-course correction to both the fuel and capacity recovering clauses, beginning with the first billing cycle in April. Duke said that the requested cost decrease has been “based on projected fuel costs for 2016 and true-up amounts for 2015.

If the filing is approved by the FPSC, the net fuel and capacity cost change will cut $5.83 from the typical 1,000-kilowatt hour (kWh) residential customer’s monthly bill – for a total cost of $108.32.

“After this price drop, our customers will be paying about 21 percent less for electricity than they were in January 2009,” stated Duke Energy State President-Florida Alex Glen, adding, “That’s nearly $30 in savings every month. We continue to seek innovative approaches to provide the best possible price while we invest in affordable, clean energy and improve reliability for our customers every day.”

Commercial customers also will see similar rate reductions depending on a number of factors including rate class and type of service.

In a press release, the company claimed that Duke Energy Florida’s typical residential rate is approximately 20 percent below the national average – noting that, according to the Consumer Price Index, costs for housing, transportation and food have increased, while Duke Energy Florida rates have dropped. Duke Energy Florida previously reduced residential rates by more than 6 percent in January.

The company says that other cost-saving price changes are on the horizon. In the spring, the company plans to issue low-cost bonds to cut costs associated with the Crystal River nuclear plant. This process, called asset securitization, will save customers approximately $600 million, the company said, as compared to traditional cost recovery methods, depending on the interest rate. Once in place, customers will see a new line on the bill titled “Asset Securitization Charge.” The amount of the charge is currently estimated by Duke to be about $2.93/month, which is about $2 less – a more than 35 percent savings for the next 20 years – than what customers would pay on a 1,000 kWh residential bill under traditional cost recovery methods.

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