Joining the other three major private electric utilities in Florida, Gulf Power Co. plans to pass along about $103 million in federal tax savings to customers.
Gulf, which serves 460,000 customers in the Panhandle, filed documents this week at the Florida Public Service Commission that detail plans to reduce customers’ bills because of the federal tax overhaul approved in December.
Florida Power & Light, Duke Energy Florida and Tampa Electric Co. recently detailed similar plans, with the tax law expected to save customers of the utilities roughly $2 billion.
While Gulf’s plan still needs approval by the Public Service Commission, the Pensacola-based utility said average residential customers would save about $14 a month.
“This is very good news for customers,” Stan Connally, Gulf Power chairman, president and CEO, said in a prepared statement on the utility’s website. “Reduced tax costs create an opportunity for Gulf Power customers to benefit from decreases in their energy prices.”
Gulf’s move to pass along savings had been anticipated, but the announcement and regulatory filing this week provided details.
Gulf, Duke, Tampa Electric and a smaller utility, Florida Public Utilities Co., entered into rate settlements last year at the Public Service Commission that included provisions about passing through tax savings to customers. But those agreements were negotiated before Congress and President Donald Trump approved the tax-cut package, which included reducing the corporate income-tax rate from 35 percent to 21 percent.
FPL did not have such a provision in its current rate agreement. But it announced in January that it would use tax savings to cover about $1.3 billion in Hurricane Irma-related costs that otherwise likely would have been passed on to customers.
Similarly, the Public Service Commission signed off last week on Duke’s plan to shield customers from getting hit with $513 million in storm costs. Also, Tampa Electric customers are expected to save an estimated $102.5 million that they would have been required to pay primarily to cover Irma costs and to replenish a storm reserve, according to filings in late January.
Gulf was largely spared damage from Hurricane Irma, which made landfall in September in Monroe and Collier counties and traveled up the state but did not veer into the Panhandle.
Gulf negotiated the savings plan with the state Office of Public Counsel, which represents consumers in utility issues, the Florida Industrial Power Users Group, which represents large commercial customers, and the Southern Alliance for Clean Energy.
If the plan is approved, the savings would take effect in April – and would come after record electricity use in January because of cold weather, the company said.
Material from the News Service of Florida and PR Wire was used in this post.