Commissions to consider revised agreement with the OUC

MARK SCHUMANN

Vero Beach’s special counsel, Schef Wright, who is representing the City on several fronts, said yesterday that in a recent conference call between representatives of Florida Power & Light, the Florida Municipal Power Agency and the Orlando Utilities Commission, no one was able to offer any new ideas for moving the power sale forward.

Essentially, the proposed sale of Vero Electric to FPL is stalled because no utility qualified to take on Vero Beach’s position in three FMPA power projects has stepped forward. The OUC had agreed to be a part of the deal, but backed out last year.

Absent the prospect of a sale to FPL, Wright and Vero Beach officials are working to lower rates. At yesterday’s City Council meeting, Wright and utility consultant Bill Harrington outlined several options and a recommendation for renegotiating the City’s wholesale power agreement with the OUC.  The revised agreement, which is first to be reviewed by the Utilities and Finance Commissions, would shorten the term of the agreement by six years, and would save the City $37,815,000 in wholesales rates over the next nine years, or an average of $4.2 million a year.

Another provision in the revised contract would enable the City to decommission the power plant, which, Wright said, would lead to an net saving of another $2 million a year.

The Council last night also received a report from City Manager Jim O’Connor, who recommended holding electric rates at their current level.

A rate sufficiency and rate structure study, and a system optimization study, both currently underway, may lead to changes in Vero Electric’s rate structure and to further cuts in operation costs.