Tampa Electric Reaches Unanimous Settlement Agreement in Rate Case
Emera’s largest operating company, Tampa Electric has filed a settlement agreement for its rate request with the Florida Public Service Commission. A ruling from the Florida PSC is expected later this year.
August 09, 2021. By News Bureau
“This is a balanced agreement that supports Emera’s strategy to advance cleaner energy with important investments in grid modernization and reliability, all while never losing sight of affordability for customers,” says Scott Balfour, President and CEO of Emera Inc. “Reaching this agreement reflects the hard work of all parties in securing rate certainty through to the end of 2024 for Tampa Electric customers while positioning the utility to make continued investments in resiliency, customer solutions and a greener energy future.”
This settlement agreement is the latest of three rate case settlements at Emera’s US utilities and demonstrates the strength of Emera’s teams and strategy as well as Emera’s ability to work collaboratively with stakeholders to reach mutually beneficial outcomes. Peoples Gas and New Mexico Gas also concluded important rate cases over the past year.
Tampa Electric has been significantly reducing the carbon intensity of its generation mix with major investments in solar and the Big Bend Modernization project. This settlement agreement supports these efforts and the retirement of three coal units at Big Bend, the addition of new cleaner high efficiency natural gas generation and the second 600MW of solar.
“This settlement further cements the transformation that is occurring at Tampa Electric and it represents a fair and amicable resolution to our request for increased rates,” said Archie Collins, President and CEO of Tampa Electric. “At Tampa Electric we are focused on creating value for customers – adding more clean solar energy, reducing carbon emissions and fuel costs, modernizing our infrastructure for a smarter tomorrow, improving reliability, increasing resiliency in the face of climate change, and improving customer service. This settlement delivers on that value commitment.”
If approved by the Florida PSC, the settlement will result in Tampa Electric’s rates remaining significantly below the national average and among the lowest in Florida. The proposed agreement will provide additional revenue increases over three years beginning January 1, 2022 with expected incremental increases in revenue of $191M USD in 2022, $90M USD in 2023 and $21M USD in 2024. The agreement includes a return on equity (ROE) range of 9 – 11% with 9.95% being used for rate making purposes.
Tampa Electric filed its rate request in April 2021 originally requesting approximately $423M USD in additional base rate revenue over the three years plus a separate asset recovery of $29M USD. The settlement for $302M USD in revenue increases over three years was reached among Tampa Electric and all intervening consumer parties, including the Office of Public Counsel, which represents consumers in utility issues, the Florida Industrial Power Users Group, Federal Executive Agencies, Florida Retail Federation, Walmart and the West Central Florida Hospital Utility Alliance.
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