The Florida Public Service Commission (FPSC) approved Tampa Electric’s petition for an inverted fuel rate for residential customers: beginning in January, customers will pay 6.416 cents per kWh for fuel up to 1,000 kWh, and then 7.416 cents per kWh for usage over 1,000 kWh. This tiered fuel conservation measure is linked to Tampa Electric’s base rate filing, in which the company has also sought approval for an inverted, two-block base energy rate for residential customers.
The Commission has also finalized its approval of all of Tampa Electric’s fuel, environment and conservation costs the company sought to recover beginning January 1, 2009. This approval represents over $1.5 billion in under-recovered costs in 2007 and 2008, with projections for 2009: costs for coal, natural gas, oil, fuel transportation, hedging and purchased power compose approximately $1.35 billion of the cost recovery amount.
Due to lower projections for 2008 and 2009 natural gas prices and the company’s ongoing cost management efforts including maximization of the use of coal, the bill increase for a residential customer using 1,000 kilowatt-hours (kWh) of electricity will be almost $11 less than originally projected. Starting in January 2009, the 1,000 kWh per month residential bill will be $128.44, compared with the original estimate of $139.25.
To help manage the increase, customers have a wide variety of energy efficiency programs available through Tampa Electric.
The cost of fuels, including those used to produce electricity, has risen dramatically in the past eight years, and the company works hard to manage fuel-related costs through competitively bid fuel contracts and a sound hedging program, and by maximizing the use of coal, a less expensive fuel.
Another important Commission decision was approval of the company’s competitively bid waterborne and rail solid fuel transportation contracts.
