Florida Public Service Commission Approves Gulf Power Rate Adjustments

Posted on March 2, 2021 by Staff reports

The Florida Public Service Commission today approved two separate rate adjustment requests from Gulf Power. The adjustments will take effect in March and result in a roughly $0.73 decrease in the typical residential customer bill of 1,000 k-Wh for the remainder of 2021.

FPSC approved a rate hike for Hurricane Sally storm restoration costs; however, a decrease to Gulf Power’s Environmental Cost Recovery Clause factor for 2021 will offset the increase, resulting in a nominal decrease.

Earlier this year, Gulf Power announced that its Plant Crist coal units had been converted to natural gas, commemorating the power plant’s new chapter as a cleaner energy facility with a new name – Gulf Clean Energy Center. The company notified the FPSC late last year that it planned to retire the plant’s coal assets early, resulting in benefits to the local community as well as cost savings for customers.
“Ending our use of coal in Florida is part of our plan to usher in a new, cleaner energy era for Northwest Florida, along with emissions-free solar farms,” said Mike Spoor, vice president of Gulf Power. “Modernizing Gulf Clean Energy Center ensures we deliver benefits for our customers and our communities through greater reliability and lower costs along with cleaner emissions.”  
The conversion of the coal-burning units to run on natural gas was a major piece of the modernization underway at the plant, along with the addition of four new, highly efficient combustion turbines to provide greater reliability and efficiency for the energy grid and a new natural gas pipeline to provide additional natural gas for the plant. By eliminating the use of coal, Gulf Clean Energy Center carbon emission rates will be reduced by 40% – the equivalent to taking an estimated 297,000 cars off the road annually – and reduce operating costs for customers. 
The retirement of coal at the plant was accelerated by Hurricane Sally, which caused damage to the plant’s coal equipment. The company determined that it is in the best interests of its customers to accelerate the conversion to natural gas instead of repairing the coal equipment. The FPSC also approved today Gulf Power’s request to begin recovery of storm restoration costs related to Hurricane Sally, a Cat. 2 storm which knocked out power to nearly 63% of customers and caused significant flooding and damage when it made landfall right at the Alabama-Florida border on Sept. 16, 2020.
Gulf Power assembled a restoration workforce of 7,000 to restore power for its customers safely and as quickly as possible – which was accomplished within five days after Sally left Gulf Power’s service area and it was safe to begin restoration work. While restoration costs are still being finalized, the company estimates that storm restoration costs that will be eligible for recovery will total more than $200 million.
“Hurricane Sally’s slow movement and strong winds caused significant damage to the energy grid and other critical infrastructure in our area. Along with our Gulf Power team, we are thankful to those who came to support us as we worked around the clock to get the lights back on safely and as quickly as possible for our customers and our communities,” said Spoor.
“We are thankful to be able to provide a net decrease in customers’ rates for the rest of 2021. We know that February’s extreme cold temperatures led to higher energy usage by customers, which ultimately leads to higher bills, and we want our customers to know that we are here to help if they need payment extensions, payment arrangements or more information on available financial assistance,” added Spoor.  
End of coal-fired power generation in Florida for FPL 
Gulf Power is a part of Florida Power & Light Company, which announced earlier this year that it formally closed its last coal-fired plant in Florida at the end of 2020. FPL purchased the Indiantown Cogeneration plant, located in Martin County, in 2017 for the sole purpose of shutting it down and saving customers money. The Indiantown plant retirement, along with the modernization of Gulf Power’s plant in Pensacola, mark the end of coal in FPL’s power plant operations. 
Investing in cleaner energy solutions 
Gulf Power and FPL are working together to provide clean, reliable energy and lowering costs for our customers while enhancing the reliability of the electric grid. The modernization of the Gulf Clean Energy Center as a natural gas power plant is a key milestone in Gulf Power’s clean energy future. 
The company is also working to make Florida a leader in clean, solar energy that keeps costs down for customers and keeps our state beautiful. FPL is advancing affordable, zero-emissions and reliable energy with 34 solar energy centers in operation across the Sunshine State – including Gulf Power’s Blue Indigo Solar Energy Center in Jackson County – with plans to continue building clean solar power for our customers. Two new solar energy centers in Northwest Florida — Cotton Creek in Escambia County and Blue Springs in Jackson County — recently started construction, with plans to begin serving customers by the end of the year, and several more are in the early stages of development.
In addition to its solar projects, the company also broke ground recently on the FPL Manatee Energy Storage Center, the world’s largest integrated solar-powered battery system. This groundbreaking energy storage system is part of an innovative modernization plan that is expected to accelerate the retirement of aging natural gas units at a neighboring power plant. Located in Parrish, Fla., the FPL Manatee Energy Storage Center is expected to begin serving customers in late 2021 by storing extra energy produced by the nearby FPL Manatee Solar Energy Center when the sun’s rays are strongest and sending it to the grid when there is a higher demand for electricity – meaning customers will benefit from solar energy even during times when the sun is not shining, such as at night or on a cloudy day.
For more information on Gulf Power’s clean energy investments, visit www.GulfPower.com/clean-reliable-energy.html.