Progress Energy Seeks Rate Reduction

Progress Energy Florida customers may see lower energy costs in 2013.

The company filed a request today with the Public Service Commission that seeks to lower rates for customers. The rate reduction would result in a six percent decrease in the average residential customer's bill, according to Progress Energy.

There would be an overall decrease of approximately $7.44 per month on the average residential bill.

This adds up to nearly $90 per year on a 1,000 kilowatt-hour (kWh) residential bill, from the current $123.19 to about $115.75.

If approved by the PSC, new prices will take effect with the first billing cycle in January.

The company made its annual requests with the Florida Public Service Commission to recover the fuel costs it paid to generate electricity and purchase power. Fuel is one of the largest components of the electric rate.

Here's a summary of those requests:

Below is a summary of the filings, based on a monthly 1,000-kWh residential bill:

·         Fuel: Filed today; decrease of $14.67 (from $48.60 to $33.93)

·         Purchased power: Filed today; increase of 70 cents (from $11.74 to $12.44)

·         Environmental compliance: Filed Aug. 30; decrease of 42 cents (from $5.45 to $5.03)

·         New nuclear generation: Filed May 1 and revised by a partial deferral requested Aug. 14; increase of $1.87 (from $2.86 to $4.73)

·         Energy-efficiency programs: To be filed Sept. 12; projecting minimal change from the current $2.88 charge.

“Progress Energy Florida is working to manage and mitigate expenses, and we are focused on keeping electric costs as low as possible for the more than 1.6 million households and businesses that depend on us,” said Vincent Dolan, Progress Energy Florida state president.

The total reduction includes a $129 million refund to customers in 2013 as part of a comprehensive rate settlement previously approved by the Public Service Commission.

Customers will benefit from settlement-related refunds totaling $288 million through 2016.

When the adjustments in these filings are included with previously approved base rates and the gross receipts tax, the average customer bill would reflect an average decrease of $7.44 per month.

The largest decrease is in the fuel charge, which recovers the actual cost of fuel, mainly natural gas and coal, used to generate electricity. The continued low commodity price of natural gas and the settlement refund have reduced this charge. 

 The Aug. 31 filing also included estimates for an increase in the cost of purchased power. Utilities routinely purchase power to ensure customers’ energy needs are met in the most cost-effective manner possible.

 The environmental compliance charge, filed Aug. 30, recovers the costs of environmental investments. Environmental improvements operating since May 2010 at the utility’s two largest coal-fired units, Crystal River 4 and 5, now allow Progress Energy Florida to use less expensive coal while reducing average annual emissions at the units by 80 percent; nitrogen oxides by approximately 93 percent and sulfur dioxide by approximately 97 percent.

 The PSC hearings on the fuel, capacity, environmental and energy-efficiency charges will take place Nov. 5-7. The PSC will finalize Progress Energy’s nuclear charge Nov. 20. At that time, the total 2013 customer bill will be determined.

 For more information about Florida rates and a detailed breakdown of a current residential customer bill, visit www.progress-energy.com/floridarates.