The truth about electric rates

The combined statewide average for investor owned and municipal utilities s $118.85 per 1000 kWh. Vero Electric’s rate is $117.58. Still, there are many utilities charging less than Vero Beach, and City leaders insist they believe rates will continue to come down, with a likely cut in rates coming in January. Meanwhile, Florida Power & Light is seeking approval for a $1.3 billion rate increase.

NEWS ANALYSIS

To listen to Indian River Shores officials, Vero Electric’s rates are unconscionable, unjustifiable, oppressive, the result of gross negligence,  and an abuse of monopolistic privileges. Ironically, Shores leaders and their attorney have made these charges before the Florida Public Service Commission, the very regulatory body that has approved for several investor owned utilities rates 15 percent higher than those charges for Vero Electric.

What Shores leaders do not discuss when making their harsh accusations of Vero Electric is the fact that following the PSC’s rate-approval formulas would leave Vero Electric plenty of room to ask for, and presumably receive approval for, still higher rates.

Shores leaders also object to Vero Beach’s practice of transferring 6 percent of electric revenue to the General Fund to help pay for City services. They argue Vero Beach’s unwillingness to offer Shores residents electric service without earning some benefit to the City and its taxpayers amounts to “taxation without representation.”  Customers of three investor owned utilities in Florida charging PSC-approved rates some 15 percent higher than Vero Electric’s rates do not get to make the “taxation-without-representation” accusation, for they are served by for-profit utilities that use their earnings to reward shareholders and executives.

Vero Electric’s transfer to the General Fund equates to a return on equity of approximately 4.5 percent. Meanwhile, Florida’s investor owned utility, with the PSC blessings and approval, earn after-tax returns on equity of 11 percent.

There are also a number of municipal utilities with rates higher that Vero Electric, but to listen to Shores officials you’d think Vero Electric’s rates are the highest in the solar system.  Currently, Vero Electric’s rate per month for 1000 kilowatt hours is $117.58.  Vero Beach officials hope to reduce rates again in January. Meanwhile, Florida Power & Light has requested PSC approval for a $1.3 billion rate increase.

Investor owned utilities with rates higher than Vero Electric:

Florida Public Utilities Northeast – $135.48

Florida Public Utilities Northwest – $135.48

Gulf Power – $132.19

Investor owned average: $124.50

Municipal utilities with rates higher than Vero Electric:

Blounston – $118.85

Bushnell – $119.05

Fort Meade – $122.56

Gainesville – $130.40

Green Cove Springs – $120

Havana – $128.74

Stark – $121.45

Municipal utility average: $113.19

 

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