Florida: Energy Winners and Losers in 2017

Happy 2018! As we would look forward to taking positive steps  towards a cleaner, smarter energy future in the Sunshine State this year, it’s instructive to look at the state energy trends from last year. Clean energy policies and projects advanced in 2017. Here’s a look at some of the energy “winners” and “losers” from 2017 in Florida.

Winners

Utility scale solar                                                                                                                                                                                                                                                                                                  

No doubt that solar power was the big winner in Florida in 2017. As solar costs continue to plummet, a number of utility scale additions came into service and there were multiple announcements of planned construction of significant new utility-scale solar in the next several years. The solar installations that served Florida in 2017 ranged in size from small systems, such as the Tampa Electric 1.8 MW solar canopy at Legoland Florida, to a number of  larger utility-owned solar systems of about 74.5 MW in size.

Gulf Power, for instance, brought 120 MW of solar power online in 2017 through a power purchase agreement (PPA) with Coronal, which constructed solar installations on three military bases in Gulf’s service territory. Duke Energy Florida announced plans, as part of its 2017 rate settlement agreement,  to build up to 700 MW of solar over the next 4 years – its first 74.9 MW project will be located in Hamilton County. SACE was a party to the agreement as it advanced solar development, closed the chapter on an abandoned nuclear project, and introduced a program to expand the use of electric vehicles.

Similarly, pursuant to a rate settlement agreement, Tampa Electric announced plans to build up to 600 MW of solar in the same time frame – and is pushing for regulatory approval from the Public Service Commission  (PSC) for the first tranche of 145 MW of solar projects. Florida Power and Light (FPL), the largest power company in the state, continued its solar expansion of by brining online another 225 MW in late December of 2016 and will complete another 596 MW (eight 74.5 MW systems) by the end of this year, or early next year.

Municipal utilities aren’t far behind, in fact many are leading their investor-owned utility brethren on solar development relative to the number of customers in their service territory (solar watts per customer). JEA, the state’s largest municipal utility, announced the addition of 250 MW of solar PPAs by 2020 as part of its revised solar policy – bringing it to about 300 MW by 2021. The City of Tallahassee is adding another 40 MW by 2020 to its already existing 20 MW for a total of 60 MW. Look for the announcement of significant solar additions by municipal utilities this year.

The recently implemented Amendment 4 (passed by voters in August 2016) – that provides significant tangible personal property tax abatement is bringing even more cost effective solar to Florida families and businesses. For instance, it will decrease costs to operate several FPL solar facilities by about $67 million (net present value) – those savings will be passed on to customers. OUC will also see additional savings from solar power – to the tune of more than $220,000 during the first year of operation of its newest solar plant. The savings will be passed on to customers through the lowered price of the solar power delivered to OUC.

Rooftop solar

With the passage of Amendment 4, and the defeat of deceptive Amendment 1 in November 2016, solar rooftop development has taken off. In fact, solar permits for new rooftop systems in 2017 surged 110% over the previous year.

Moreover, solar coops are playing an increasingly important role in the residential rooftop market by providing information to homeowners interested in capturing the economic savings produced from rooftop solar and / or those wanting to pave the way to a cleaner future for the next generation. The coop also pools the buying power of members to secure the most competitive price for members. More than 600 homeowners have gone solar with the help of a local solar co-op. No less than 17 coops have been in created in counties throughout the Sunshine State in the last year or so.

Losers

Fixed charges

Early in 2017, Gulf Power, as part of a rate hike request, unwisely proposed a huge increase in the fixed charge portion of residential bills from $18 per month to $48 per month. That meant that every month, customers would owe the utility a hefty sum before they even flip on a light switch – much less of the customer’s bill would be based on actual energy use.  Such a large fixed charge spike on bills would have severely limited customer choice in reducing energy use and saving money on bills through energy efficiency measures or rooftop solar. Gulf customers mobilized as did a number of groups, including SACE, League of Women Voters, Consumers Union, and Conservatives for Energy Freedom to challenge the spike in the fixed charge. The pushback came in the form comments at public hearings, in letters to the Florida PSC, on social and media and in local papers. After the intense blowback, Gulf withdrew the proposal and the rate case was settled without the dangerous precedent-setting spike in customer fixed charges. SACE was a party to the settlement agreement.

Proposed nuclear reactors                                                                                                     

FPL’s plans to construct 2 new nuclear reactors at its Turkey Point plant took a major hit in 2017, and the project is now effectively dead. There is no construction company to build the reactors, as Westinghouse filed for bankruptcy and has publicly announced it is out of the reactor construction business. FPL customers had already paid $282 million into the project when FPL came back in to the Florida PSC in 2017 asking for permission to accrue costs, for later recovery from customers, for continuing to pursue the project licensing. FPL couldn’t prove that the reactor construction remained economically feasible. SACE, Office of Public Counsel and others challenged the cost recovery on behalf of customers. Shortly before the Florida PSC decision, two proposed reactors, of the same design in South Carolina, were cancelled after projected costs to complete the reactors soared to over $25 billion. The Commission appropriately rejected FPL’s request for more customer dollars without a feasibility analysis to determine whether the reactors are a good deal for Florida families and businesses in FPL’s territory.

As we head into the new year, SACE will continue to work for responsible energy policy in the Sunshine State, going to toe-to-toe with the state’s biggest power companies, when necessary, and working with them when we can find common ground on clean energy policies that move the state to a lower cost, lower risk energy future.

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1 Comment

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Taxpayers should get the $282M FPL took for the reactors at Turkey Point back. The state needs to stop rewarding this company for its predatory practices.


Comment by Michelle Gale on January 13, 2018 1:15 am


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