Florida Supreme Court says FPL can’t charge customers for gas drilling


In a win for Florida Power & Light customers, the Florida Supreme Court today reversed a Florida Public Service Commission decision allowing FPL to charge ratepayers for an oil and gas exploration and drilling venture in Oklahoma.

The court found the PSC exceeded its statutory authority when it approved recovery of FPL’s costs and investments in the Woodford Project in Oklahoma’s Woodford shale region. The court said in its decision that the PSC considered the recovery of costs of the hydraulic fracking venture through fuel charges paid by FPL customers to be a long-term physical hedge.

“Treating these activities as a hedge requires FPL’s end-user consumers to guarantee the capital investment and operations of a speculative oil and gas venture without the Florida Legislature’s Authority. Accordingly, we reverse,” the court wrote in its 20-page decision.

In an email, FPL spokeswoman Sarah Gatewood said the utility was “disappointed by the Court’s decision.” Gatewood said the Woodford project would “provide reliable electricity at low and stable prices by investing directly at the source to provide rate stability and reduce risk for our customers.”

In December 2014, the PSC approved FPL’s request to collect the cost of its $191 million venture with PetroQuest in Oklahoma’s Woodford Shale region from its 4.8 million customer accounts through fuel charges on their bills.

Then, in June 2015, the PSC gave FPL the go-ahead to invest as much as $500 million a year in natural gas drilling operations — effectively making the utility and its customers partners in what can be a risky business. FPL uses natural gas to provide 72 percent of the fuel to run its power plants.

Three PSC orders on the issue were appealed by the Office of Public Counsel, the Florida Retail Federation, and the Florida Industrial Power Users Group.

“It is a good day for FIPUG members and other consumers. They will not be forced to pay for risky oil and natural gas ventures in Oklahoma and elsewhere,” said Jon Moyle, a Tallahassee attorney who represents FIPUG.

The court also said that statutes allow utilities to charge customers only for costs arising from the “generation, transmission or distribution” of electricity, and the Woodford project falls outside of the purview of an electric utility.

Whether advance cost recovery of speculative capital investments in gas exploration by an electric utility is in the public interest is a policy determination that must be made by the Legislature, the court said.


Reader Comments ...


Next Up in Nation & World

LeBron James and Black Panther director working on ‘Space Jam 2’
LeBron James and Black Panther director working on ‘Space Jam 2’

LeBron James and Ryan Coogler, the director of blockbuster “Black Panther,” are reportedly collaborating to create a second movie in the “Space Jam” franchise. James' production company, SpringHill Entertainment, tweeted Wednesday that Coogler will produce the sequel to the 1996 movie that featured Michael Jordan alongside...
4 injured, gunman killed in shooting at Wisconsin software company
4 injured, gunman killed in shooting at Wisconsin software company

Police in Middleton, Wisconsin, are investigating a shooting Wednesday morning that injured four people, three seriously, at an office building outside Madison that houses a software company, according to multiple news reports. The shooter, who was has not been identified, was shot and killed by police when they responded to the scene at WTS Paradigm...
Teen arrested, another sought in killing of Atlanta grandmother, charity worker
Teen arrested, another sought in killing of Atlanta grandmother, charity worker

Police have arrested one teenager and are searching for another in connection with the death of an Atlanta grandmother shot and killed while driving home from her job at a center for homeless mothers. >> Read more trending news  Adarius Jones, 18, was arrested Wednesday and faces murder charges in the Aug. 12 shooting of Beverly Jenkins...
Some Maine lobsters getting 'baked' before boiling
Some Maine lobsters getting 'baked' before boiling

Some lobsters in Maine are getting baked before getting boiled.  A restaurant in Downeast, Maine says it's getting lobsters high before killing them -- because it's more humane.  According to the Mount Desert Islander, Charlotte Gill, owner of Charlotte’s Legendary Lobster Pound, is trying a humane way of executing lobsters. The lobsters...
FAU poll shows tight race between Scott-Nelson and Gillum-DeSantis
FAU poll shows tight race between Scott-Nelson and Gillum-DeSantis

After defying the pollsters to win Florida’s Democratic primary for governor last month, Andrew Gillum has become the toast of the polling crowd in early surveys of the nationally watched general election race against Republican Ron DeSantis. Gillum, who did not lead in any publicly released polls before his stunning Aug. 28 primary win, is the...
More Stories