Faherty’s “Utility Update” again misinforming readers

COMMENTARY

MARK SCHUMANN

Pro-sale utility activist, Stephen Faherty, who has worked closely with Glenn Heran since 2008 to promote the sale of Vero Electric to Florida Power & Light, issues a weekly email newsletter called the Utility Update. Faherty’s information seems increasing disconnected from reality.

Faherty’s recent significant misstatements of fact leave some wondering if his numbers and claims have every been much more than exaggerations, if not fantasy.

For example, in a version of Utility Update issued today, Faherty wrote, “If I recall correctly, the City had the deal with the OUC to take the City’s three years of power obligations for $30-$34 million until the FMPA said it wanted to take over the power. That kicked the cost up to $52 million.”

Given that Faherty presents himself as an expert on the City’s utility finances, it is difficult to understand how he could be so misinformed about the negotiations to sell Vero Electric. In truth, for $34 million the Orlando Utilities Commission has agreed to permanently assume Vero Beach’s position in three FMPA power projects as of Jan. 1, 2018. Faherty is confusing this long-term agreement, which is still in place, with separate, ongoing negotiations over who will take Vero Beach’s power entitlements until Dec. 31, 2017.

The plan had been for Florida Power & Light to buy 38 megawatts of Vero Beach’s Stanton I and II power from the OUC through Dec. 31, 2017 for an estimated premium of $30 million. However, when it became obvious to bond attorneys for all parties that the proposed short-term power agreement would not likely be approved by the Internal Revenue Service, the Florida Municipal Power Agency was asked to name a price at which it would be willing to absorb the power.

Though FMPA officials made it clear they neither wanted nor needed the power, they did offer to take it on for up to three years for $52 million. FPL accepted the FMPA’s price, but added a number of conditions, which FMPA General Manager Nicholas Guarriello has indicated are “unworkable and unacceptable.”

FPL is reportedly now working with the OUC on a short-term power agreement.