A Florida House committee approved a bill Thursday intended to force electric companies into longterm strategies to harden power grids against storms by burying lines received unanimous approval in a House committee Thursday even with opposition pointing out this will change rate hike reviews to pass along all costs to consumers.
House Bill 797, from Brevard County Republican state Rep. Randy Fine, requires power companies to commit to longterm plans to harden their grids against the hurricanes that have been ravaging Florida. It passed out of the House Committee on Commerce Thursday, its last stop on the way to the House floor.
Its counterpart, Senate Bill 796, also has been surging through that chamber.
Opponents of HB 797 argued that power companies already are hardening their power grids that and that the key change in the bill, one they say consumers should oppose, is that it revises the rules so that power companies can pass along those costs through “clause rate” hike requests through the Florida Public Service Commission, while the hardening currently is being done through base rates, largely absorbed by the utilities.
Fine and several other members of the committee argued that the costs of Floridians losing power for weeks at a time following major hurricanes will be far greater than any rate hikes associated with putting pressure on utilities to bury as many lines as possible.
“My lifelong residency in the state of Florida, having lived through lots, lots of storms, and the outcry every post-storm, from every resident, they ask time and time again, ‘Why can’t we go underground? Why can’t we go underground?” said Democratic state Rep. Evan Jenne of Dania Beach, in explaining his support.
“So the real question is: ‘Do we pay now, or do we pay later?'” he added.
How much those rate hikes might be is unclear. The bill requires utilities to submit data and clause rates for review every year to the Public Service Commission. Even with the longterm plans required, the grid-hardening is expected to take decades; the bill calls for 10-year plans, updated every three years, and allows them to recover the costs through clause rate hikes for 30 years.
Multiplying out per-mile estimates of line burial that were included in the committee’s staff report, opponent Jon Moyle, representing the Florida Industrial Power Users Group, suggested the bill could cost rate payers $30 billion. Fine and others disputed the calculation as likely a gross overestimate, but no one offered any alternative projections.
The bill also spreads the costs of any line-burial or other storm-hardening projects across a utility’s entire system, meaning the big power users will absorb costs through rate hikes of work being done outside their properties, as will everyone else.
Fine countered that Moyle’s clients are the big industrial plants in Florida who not only will see the biggest hits from rate increases but who also likely already have underground power lines because as big electricity customers they are top priorities for the utilities’ storm-hardening strategies.
HB 797, Fine argued, will force improvements for “regular folks”, who haven’t seen it yet. He also cautioned against any panic on rate hikes.
“Every aspect of this bill, every aspect of these plans, has to be reviewed by the government. So they don’t get to do this, and say ‘hey, we’re going to put out gold-plated, underground wires and then we’re going to charge through the roof for having done it,” Fine said. “It has to pass muster with the PSC using clear criteria saying this is in the state’s interest for us to do it.
“Could they make money doing it? Sure; that’s what businesses do,” Fine continued. “And I will tell you frankly I’m OK if they make a little bit more money, because my power doesn’t go out, and the power of my constituents doesn’t go out. And people don’t get hurt because they can’t go to work and frankly sometimes die because they don’t have access to the equipment they need.”