It’s not often, but every now and then, states put smart policies in place that can easily translate to other states. Unfortunately, it’s more common for terrible ideas to metastasize than good ones.
That’s what the backers of the so-called “energy choice” amendment are offering Florida.
Citizens for Energy Choice wants customers of investor-owned utilities to be able to shop around rather than be tied to their local utility provider. They say it will lead to lower bills, saving Floridians more than $5 billion a year.
If it sounds too good to be true, that’s because it is.
There’s a reason groups as disparate as the Florida Chamber of Commerce, the League of Cities and the Urban Leagues of Jacksonville, Central Florida and Palm Beach County are all warning of the amendment’s consequences.
Florida’s congressional delegation feels the same — in a display of unity remarkable for its rarity, 12 Democrats and 12 Republicans representing Florida in the U.S. House signed on to a letter urging Attorney General Ashley Moody to fight the amendment and save the people of the state from higher rates and unreliable service.
Their fears aren’t unfounded.
Other states have played the guinea pig in the energy deregulation experiment.
Most Northeastern states have given it a shot to great expense, and though Michigan only dipped its toe in the deregulation waters, its residents have wound up paying hundreds of millions of dollars more every year to maintain the grid.
And then there’s Texas.
Through a decade of deregulation, Texans have paid more than $10 billion over the market rate to keep their lights on.
It hasn’t made the grid more reliable, either. According to a report from the North American Electric Reliability Corp., the state “has gone from having the best power reserves prior to deregulation to having the nation’s worst, creating the peril of rolling blackouts during summer heatwaves.”
About the only thing deregulation has accomplished for the Lone Star State is to create wealthy utility company CEOs.
Despite presiding over the longest power outage in San Antonio’s history post-Hurricane Ike, CenterPoint CEO David McClanahan got a $1.4 million pay raise in 2009. At that time, the Houston Chronicle reports, his salary had grown sevenfold from what he made before the Texas Legislature deregulated the state’s electricity system.
Imagine if Northwest Florida residents were funding such a pay raise in the wake of Hurricane Michael. Moreover, imagine how a utility company in that environment would handle a storm of that magnitude.
Here’s some nightmare fuel: They wouldn’t.
When Michael hit, Gulf Power sent brigades of linemen to the scene and they virtually rebuilt the Panama City power grid in a matter of weeks.
When Hurricane Sandy hit Connecticut, the few linemen who still worked for Connecticut Light & Power were scrambling without the resources to do their job.
Recalling the disaster, Frank Cirillo, an official with the International Brotherhood of Electrical Workers in Connecticut, said the staff cutbacks cause brought about by deregulation wreaked havoc on disaster preparedness.
The cuts went through every level and even hit the supply room, where a single clerk was responsible for handling every request.
“It’s like a million people at a Stop N’ Shop and there is one [expletive] cashier,” he told the Houston Chronicle.
Meanwhile, energy prices in Texas are soaring.
Just last week, a heat wave shot prices up to $9,000 a megawatt-hour, or $9 a kilowatt-hour. It doesn’t matter what part of Florida you live in, that’s about 100 times the going rate in the Sunshine State.
According to Bloomberg, that price spike made Texas the “most expensive place to buy power in all of America’s major markets.”
Florida isn’t much cooler than Texas. But Florida also has humidity.
If those prices were commonplace in Florida, air conditioners would be clicked off, mold would invade and people would start getting sick — fast.
Citizens for Energy Choice would have Floridians believe such worries are nonsense, that the troubles in other states couldn’t happen here, and that all they’re trying to do is save the average family a few bucks on their utility bill.
Don’t fall for it.