The ‘energy choice amendment’ might actually cost you more. Here’s why

energy costs 2
If it sounds too good to be true, that’s because it is.

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.

Drew Wilson

Drew Wilson covers legislative campaigns and fundraising for Florida Politics. He is a former editor at The Independent Florida Alligator and business correspondent at The Hollywood Reporter. Wilson, a University of Florida alumnus, covered the state economy and Legislature for LobbyTools and The Florida Current prior to joining Florida Politics.


5 comments

  • Dan

    August 23, 2019 at 10:16 pm

    When I see the list of self serving governmental agencies against it, we know plenty of donor $$ are going into their coffers. The same way that Duke Energy was allowed to charge Pinellas & all Duke customers 25% more for electric than any other electric company in Florida ($6 Billion) for the false mention (Not Contract) of a new Nuclear Power Plant they admitted would never be built and was never planned or licensed. Yet we still paying for their theft 10 years later and their special interest wealth redistribution. If I can pay the same as Tampa & Teco, I would save 3 months of Electric bills every year. Who on that list can be trusted to be working for the citizens and not their own coffers & careers.

    • Reese

      August 24, 2019 at 8:08 am

      Amen! Give the people a choice! When have monopolies ever been in the best interest of the public??

  • J G

    August 24, 2019 at 5:19 pm

    I don’t know enough about the energy choice amendment to comment about it directly but I lived a long time in Pennsylvania where they allowed you to choose you electricity supplier. Note that this allows you to choose only the folks that will generate your electricity not those who will deliver it. After all it would be impractical to have to run a separate set of wires to your house.

    This means that only a relatively small part of your bill is up for grabs; perhaps a third. So you sign up with a company offering to save you $3.50 a month. You don’t read the fine print very closely but it could include a fixed term of probably a year. Fine if rates go up but they might go down. It did for us in PA but you’re locked in. Hard to believe but true as this was just at the beginning of the fraking boom and PA is Marcellus shale country. Lots of cheap gas all of a sudden. Ok, so you find a supplier that won’t lock you in to a fixed contract and guess what. Rates go up and your bill with them. With each contract renewal you have to shop around to find the new cheapest supplier. It definitely won’t be your current supplier because it’s part of the plan to sign you up then raise prices with the certainty that most folks won’t notice and just keep paying. And, by the way, if you want green power, you know to be environmentally conscience, that ALWAYS costs more.

    Your job is to outsmart the electricity generators at their own game and the reward is chickenfeed. I found myself spending more time checking rates and trying to figure out if I was saving anything that any savings was rewarding my efforts at a rate of about 19 cents and hour. I found the whole exercise not worth the trouble after a couple of years.

  • Patrick

    August 26, 2019 at 9:33 pm

    thorium nuclear is the future I hope florida ca be a leader

  • Feel free to email me

    September 1, 2019 at 11:57 am

    As a manager over an entire Texas electricity brand, which we recently exited, I would welcome the author’s email to help clarify how things really work here in Texas. My parents in Florida pay 30% more than here in Texas, and the wholesale rates between the big utilities and the cities in Florida, are even higher than what we pay here. Ivan Penn, who worked at the St Pete times, was spot on in his analysis years ago about some of these issues.

Comments are closed.


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