Fla. PSC sets stronger energy conservation goals

AP News
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Posted: Dec 01, 2009 5:42 PM

The Public Service Commission set 10-year energy conservation goals Tuesday that are significantly stronger than Florida's major electric utilities had proposed but well short of what environmentalists wanted.

The goals differ for each utility but overall are expected to produce energy savings of about 3.5 percent over the next decade, said Susan Glickman, spokeswoman for the Southern Alliance for Clean Energy and Natural Resources Defense Council

That's only about a third of the 10 percent savings on power sales the two groups had proposed. A consultant hired by the commission had suggested 9 percent. Glickman said those recommendations are similar to goals set by the leading energy efficiency states.

The commission's staff, though, proposed only 1.18 percent in a recommendation the panel rejected last month. The staff then submitted a revised recommendation for 2.11 percent.

"Despite a thoughtful discussion on how to make energy efficiency more available ... in the end the commission set disappointing energy efficiency goals," Glickman said. "They were being held back by the advice they were receiving from their staff."

The five-member panel unanimously voted to strengthen the final staff recommendation by adding financial incentives for customers of Florida's four largest power companies to take such measures as buying energy-saving light bulbs and appliances and insulating water heaters.

The details of those incentives will be outlined in implementation plans the utilities must submit for commission approval in about three months.

The staff recommended against the incentives because many consumers, labeled "free riders," likely will take those steps without them.

Commissioner Nancy Argenziano disagreed.

"There are a lot of people who just can't do it; I think they need some incentives," Argenziano said. "They'd loved to be able to go out and buy a more energy efficient refrigerator or an air conditioning unit. They can't afford $6,000, $5,000, $800.

The commission also authorized utilities to provide up to $24.5 million in incentives for installing solar energy systems _ nearly doubling rebates already available from the state.

Another key decision was to use a cost-effectiveness test that counts conservation savings as a benefit rather than a previous method that viewed them as a cost to consumers. Glickman said that was a "step forward."

The goal for Florida Power & Light Co., the state's largest electric utility, is expected to have a revenue impact of $180 million over 10 years _ nearly twice what the company proposed _ but well under the $629 million sought by the environmental groups.

The affect on Progress Energy Florida would be $203 million compared to the company's $36 million proposal and $220 million recommended by the environmentalists.

Progress Energy spokesman Tim Leljedal said the company's request was for about 50 percent more savings than current goals and designed to produce the maximum benefit for the lowest cost.

"We've been helping customers save energy since 1981," Leljedal said. "We've helped them save more than $1 billion in that time."

Tampa Electric Co.'s goal is $21 million while the company sought $12 million and the environmental groups proposed $118 million.

Gulf Power Co.'s goal is $33 million compared to the utility's $9 million proposal and $79 million recommended by the environmentalists.

The commission set lower goals for Florida Public Utilities Co. and municipal systems in Orlando and Jacksonville, all without the "free rider" incentives.

Commission staffer Tom Ballinger told the panel the goals required by state law put the utilities in an awkward position.

"You're telling them not to sell a product," Ballinger said. "It's like paying farmers not to grow corn."

(This version CORRECTS spelling of "Leljedal" in the 16th paragraph.)