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|PSC Approves FPL Mid-Year Fuel Adjustment|
|JUNO BEACH, Fla., Jul 01, 2008 (BUSINESS WIRE) -- Florida Power & Light Company today received Florida Public
Service Commission (PSC) approval to adjust the pass-through fuel
surcharge on customers' bills and recover $746 million in
unanticipated fuel costs. Dramatic increases in world oil and natural
gas prices made it necessary for the company to file a mid-year fuel
correction as required by the PSC.
The company will recover 50 percent of the additional $746 million in fuel costs between August and December of 2008 and the remaining 50 percent over the 12 months of 2009. A 1,000 kilowatt-hour monthly residential bill would increase beginning in August 2008 by $8.14, from $102.63 to $110.77, or about 8 percent. Based on current market prices for fuel, a 1,000 kilowatt-hour monthly residential bill in 2009 would increase to approximately $122, or about 10 percent. This 2009 rate is a projection and may vary depending on factors such as the volatility of world fuel markets, hurricane events, and other bill impacts.
Under Florida law, FPL is not permitted to earn a profit on fuel and customers only pay for the fuel needed to produce the electricity they consume. When fuel prices go up, the additional costs are passed through to customers, and when fuel prices go down, the savings are also passed through to customers.
We recognize that higher electric bills will be a burden on our customers. We never like having to increase the price customers pay for electricity, and it's especially painful during difficult economic times. We are doing everything we can to mitigate the impact of higher fossil fuel costs -- modernizing older plants, increasing the output at our nuclear facilities, and proposing to build three solar energy centers. However, the increase in fuel prices that we have been experiencing is extraordinary. This is not unique to FPL; utilities across the country are experiencing the same issue, said FPL President, Armando J. Olivera.
In its mid-year fuel correction filing, the company reported that the cost of natural gas has jumped from $8.17 per million BTU in July 2007 (which formed the basis of FPL's 2008 fuel filing) to $10.75 per million BTU in May 2008, a 32 percent increase. Fuel oil, which powers 8 percent of FPL's electricity generation, went up for the same period from $57.81 per barrel in July of 2007 to $89.02 per barrel in May of 2008, a 54 percent increase. The cost of fuel has continued to go up since the company filed its petition in early June, and at this point FPL is projecting an additional $300 million under-recovery at the end of 2008. This projection may vary depending on factors such as the volatility of world fuel markets, hurricane events, and other bill impacts.
FPL's fleet is fuel efficient and continues to improve
FPL has taken numerous steps to mitigate the impact of fuel costs by improving the efficiency of its existing plants and building new generation facilities with low or no fuel costs:
-- FPL's fossil fuel power plant fleet is the most fuel efficient among large-scale utilities nationwide. The company has improved fleet fuel efficiency by 10 percent in the past five years and by 18 percent since 1990. As a fossil power plant increases in efficiency, it can generate the same megawatt hour of electricity with less fuel, thus saving money for FPL customers and producing fewer greenhouse gases.
-- FPL has proposed to modernize its power plants at Riviera Beach and Cape Canaveral, a move that will save customers roughly $450 million in fuel and other savings over the life of the project. The new units will be considerably more efficient than the existing facilities, using 33 percent less fuel to produce the same amount of power.
-- FPL is upgrading its existing nuclear facilities to produce an additional 400 megawatts of power, which is the equivalent of a medium-sized fossil fuel plant. Fuel costs for nuclear plants are dramatically lower than for fossil-fuel generation, costing roughly half a cent per kilowatt hour compared to 7 cents for natural gas and 10 cents for fuel oil.
-- FPL has proposed to build three solar energy centers in Florida with a capacity of 110 megawatts. The fuel used to power these sites will be free.
FPL offers programs to help customers
FPL offers many programs and tips to its customers to help them manage their monthly electric bills. (Information is available on FPL's website at www.fpl.com). For example, customers can sign up for Budget Billing, which allows them to smooth out the amount of their monthly bill over the course of the year. In addition, FPL offers programs to help customers control their energy use, such as:
-- Home Energy Surveys. A personalized analysis of home energy usage, along with a report providing energy-saving tips and recommendations.
-- On Call(R). A program that automatically turns off major appliances when electricity demand is at its highest. Customers can save up to $8 a month.
-- A/C Buying Program. Because air conditioning alone can amount to more than half of total energy consumption in the summer months, FPL offers customers an incentive to install high-efficiency heating and cooling systems for homes.
-- Duct System Test and Repair. For a nominal fee, FPL will inspect a home's cooling and heating ducts for costly leaks and even help pay to have them repaired.
-- Photovoltaic Systems. FPL is committed to helping environmentally conscious customers offset some of their electricity costs by providing the means to interconnect their small photovoltaic systems to FPL's power grid.
-- Energy Savings Toolkit. Customers can learn about common causes for high bills and solutions to help control energy usage and lower their bills.
-- Building Envelope Program: FPL will pay incentives to reduce the cost of installing new insulation on homes built before 1982 and to install a roof that reflects the sun's rays.
-- BuildSmart(R). FPL certifies new construction homes save up to 30 percent on energy bills when built to the FPL BuildSmart standard.
Tips for reducing your electricity usage
FPL also offers its customers a host of tips they can use to control their energy use. For example:
-- Cool your home at 78 degrees or warmer with the thermostat fan switch on auto. For additional savings, raise your thermostat to 82 degrees or warmer when you're away from home.
-- Install a programmable thermostat to adjust the temperature automatically and maximize your energy savings.
-- Clean or replace your air conditioner's filter monthly to trim your cooling costs.
-- Turn off your ceiling fan when you leave the room. A fan that runs constantly can cost up to $7 a month depending on size and age.
-- Avoid pre-rinsing dishes before putting in dishwasher. It can save nearly $6 a month.
-- Limit the time you run your pool pump to six hours a day in summer and four a day in winter.
-- Adjust the water level on your washing machine to match the load size, especially when using hot water. Always use a cold rinse.
-- Clean the lint filter in your dryer before every load to dry your clothes faster and save money.
-- Use the auto sensor function on your dryer, if you have one, to conserve energy by not over-drying your clothes.
Florida Power & Light Company is a subsidiary of FPL Group, Inc. (NYSE:FPL), nationally known as a high quality, efficient and customer-driven organization focused on energy-related products and services. With annual revenues of over $15 billion and a growing presence in 27 states, FPL Group is widely recognized as one of the country's premier power companies. Florida Power & Light Company serves 4.5 million customer accounts in Florida. FPL Energy, LLC, FPL Group's competitive energy subsidiary, is a leader in producing electricity from clean and renewable fuels. Additional information is available on the Internet at www.FPL.com, www.FPLGroup.com and www.FPLEnergy.com.
Note to Editors: High-resolution logos and executive head shots are available for download at http://www.fpl.com/news/logos.shtml.
SOURCE: Florida Power & Light CompanyFlorida Power & Light Company, Juno Beach
Mayco Villafana, 305-552-3888