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Settlement Agreement

PSC Cuts Back Rate Increase Requested by Florida City Gas

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Florida City Gas (FCG) customer rates and system reliability will benefit from the Florida Public Service Commission’s (PSC) approval today of a negotiated Settlement Agreement (Settlement) in the company’s pending rate case.

FCG’s Settlement term runs for four years, from June 2018 to May 2022, and includes an annual revenue increase of $11.5 million, instead of the $15.8 million FCG requested in its original October 23, 2017 petition. The Settlement also saves customers $4.5 million in projected tax reductions from the 2017 Tax Cuts and Jobs Act.

“We require FCG to provide reliable service and keep rates reasonable,” said PSC Chairman Art Graham. “By providing additional revenues for an LNG facility, the PSC increased service reliability for FCG customers, and we are also providing stable rates for four years that are lower than those originally proposed.”

When completed, FCG’s new LNG facility will add 10,000 dekatherms of capacity per day. This increased reliability will be financed through two revenue increases: $2.5 million in June 2019 and $1.3 million in December 2019. In total, FCG’s allowed revenue increase per the Settlement is $15.3 million.

The Settlement sets a return on equity of 10.19 percent, instead of the 11.25 percent FCG requested. It also authorizes FCG to establish a storm reserve with an annual accrual of $57,500 and a target reserve level of $800,000.

Beginning in June, FCG’s typical residential customer using 14 therms will see a monthly bill increase of $1.34, from the present $26.97 (includes the cost of gas) to $28.32. Signatories to the Settlement Agreement include the Office of Public Counsel—representing consumers—and the Federal Executive Agencies.

The PSC held customer service hearings on FCG’s rate request on January 23 in Coral Gables and on January 24 in Port St. Lucie and Melbourne.

FCG currently provides service to more than 108,000 customers throughout south and central Florida.

For additional information, visit floridapsc.com.

Florida PSC Approves Settlement Agreement for Tampa Electric

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The Florida Public Service Commission (PSC) today approved a Settlement Agreement for Tampa Electric Company (TECO) that will expand the utility’s use of solar power and provide rate certainty to customers for the next four years.
TECO plans to add 600 megawatts (MW) of solar energy, which is enough electricity to power more than 100,000 homes and represents a large boost to the nearly 27 MW of solar installations the utility currently owns and operates. The first two projects, totaling 150 MW, are scheduled for completion in September 2018, with additional phases completed in 2019, 2020, and 2021.
The Agreement also includes a four-year pilot program to optimize assets and wholesale energy transactions. Potential increased revenues from expanded short-term wholesale purchases and sales will create additional value for both customers and the company. Customers will not pay for the pilot program costs.
Parties joining the Agreement include: Florida’s Office of Public Counsel (OPC), representing consumers, the Florida Retail Federation, the Florida Industrial Power User’s Group, West Central Florida Hospital Utility Alliance, and the Federal Executive Agencies. In addition, the Southern Alliance for Clean Energy and the Sierra Club support the Agreement.
TECO’s current Agreement, approved by the PSC in 2013, was set to expire at the end of 2017.
Tampa Electric serves about 745,000 customers in Hillsborough, Polk, Pinellas, and Pasco counties.

PSC to Hear Proposed Settlement Agreement for Tampa Electric Company

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The Florida Public Service Commission (PSC) will hold a hearing  November 6, 2017, on Tampa Electric Company’s proposed Settlement Agreement.  The hearing will give parties an opportunity to present testimony and conduct cross-examination on the terms of the Settlement Agreement.
The hearing is set for the following time and location:

Monday, November 6, 2017
1:00 p.m.
Betty Easley Conference Center
Joseph P. Cresse Hearing Room (Room 148)
4075 Esplanade Way
Tallahassee, Florida

The hearing will be broadcast on the Florida Channel (check your local listing) and is available online HERE (look for the Watch Live Broadcast” icon on the left side of the webpage).

Florida PSC Approves Settlement Agreement for Duke Energy

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The Florida Public Service Commission (PSC) today approved a wide-ranging Settlement Agreement for Duke Energy Florida, LLC (DEF) that eliminates constructing nuclear reactors in Levy County and boosts large scale solar, electric vehicles, and battery storage programs.
Reached with the Office of Public Counsel, representing consumers, the Settlement Agreement was also signed by the Florida Retail Federation, the Florida Industrial Power Users Group, White Springs Agricultural Chemicals, Inc. d/b/a PCS Phosphate, and the Southern Alliance for Clean Energy.
Following are some terms included in the approved Settlement Agreement:
Levy Nuclear Project: DEF will not continue the project and will not recover about $150 million in remaining customer costs.
Fuel Costs in 2018: DEF recently filed a request to recover about $196 million in unanticipated power-plant fuel costs. Under the agreement, DEF will reduce this customer charge by recovering the costs over two years, instead of one.
Solar Projects: DEF will build about 175 megawatts of solar-generation each year for four years and can seek base rate increases to pay for the projects starting in 2019.
Base Rates: DEF’s proposed 2018 bill increases are reduced and annual incremental increases are limited to 1 to 3 percent from 2019 to 2021. DEF is prevented from seeking additional base rate increases until at least 2021.
The agreement is effective upon Commission approval, and changes to customer bills will occur in January 2018.
For additional information, visit www.floridapsc.com.

Tampa Electric Embraces 21st Century Technologies

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Commits to 600 MW of New Solar in Settlement Agreement

Energy Advocates Applaud Efforts to Grow Solar and Work Proactively with Stakeholders

Late Wednesday, Tampa Electric Company filed a rate settlement agreement with the Florida Public Service Commission that’s intended to significantly increase its use of solar power and provide rate certainty to customers.
The agreement will ensure more investment in large-scale solar facilities by providing for the construction of up 600 MW of additional solar facilities over the next 4 years. Tampa Electric’s commitment to solar power, relative to is size, would place it among the leading utilities in the Southeast region on solar power.
“The Southern Alliance for Clean Energy (SACE) applauds Tampa Electric’s leadership on expanding solar power in the Sunshine State,” said Dr. Stephen A. Smith, executive director of the Southern Alliance for Clean Energy. “We strongly feel that solar power is good for customers by diversifying the energy portfolio and for the environment by providing low-cost, zero-emissions energy for Florida’s families and businesses. We look forward to working with Tampa Electric as they offer more clean energy options and embrace new technologies that will make Tampa a more resilient community.”
“SACE is pleased to see Florida utilities responding to customer demand, market forces and the need for more corporate responsibility to proactivity address climate change with solar technology,” continued Dr. Smith. “SACE supports and advocates for all segments of the solar power market, residential, commercial, and utility scale to be fully functional and competitive in the Sunshine State.”

Duke Energy Florida Commits to 700 MW of New Solar in Settlement Agreement

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Energy Advocates Applaud Efforts to Work Proactively with Stakeholders

Earlier today, Duke Energy Florida (DEF) filed a rate settlement agreement with the Florida Public Service Commission resolving a number of outstanding issues and setting rates for DEF for the next four years beginning on January 1, 2018.
In addition to the Southern Alliance for Clean Energy, a number of other parties have signed on to the agreement, including the Office of Public Counsel, Florida Retail Federation, Florida Industrial Power Users Group, and PCS Phosphate.
“We applaud Duke Energy Florida for working proactively with stakeholders to embrace smart technologies that are both good for consumers and the environment,” said Dr. Stephen A. Smith, executive director of the Southern Alliance for Clean Energy. “Large scale solar, electric vehicles and battery storage demonstrate that Duke is embracing technologies for the 21st century. We welcome Duke’s willingness to work with stakeholders on data collection and any rate design changes impacting customer-owned demand side solar.”
Southern Alliance for Clean Energy is pleased with the overall direction of this agreement as it will ensure:

  1. More investment in large scale solar facilities (700 megawatts);
  2. Closer collaboration with stakeholders, like SACE, on collecting data on the economic and operational benefits of customer-owned solar and related rate design issues;
  3. A commitment to grow electric vehicle infrastructure by investing $8 million for 530 outlets in its service territory;
  4. Deploying up to 50 megawatts of battery storage to support renewable energy development;
  5. Greater deployment of smart meters and will introduce Time Of Use (TOU) rates that encourage energy efficiency and customer-owned solar, and;
  6. Customers will not have to pay any further costs related the cancelled Levy County nuclear plant.

As a party to this settlement, the Southern Alliance for Clean Energy will be able to enforce many of the provisions of the agreement. A petition was filed today at the Florida Public Service Commission, along with the settlement agreement, requesting approval of the agreement by the end of this year.

Former Commissioner Asks Court to Block Award of I-395 Bridge Contract, Saying It Violates Settlement Agreement

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Former Miami City Commissioner Marc Sarnoff today went to court to block the Florida Department of Transportation (FDOT) from moving forward with its award of a contract to build a new, signature I-395 bridge, arguing the award violates a settlement agreement that promised local control over the bridge’s aesthetic design.
Attorneys Jay Solowsky and Mason Pertnoy of Miami law firm Solowsky Allen, P.L., reopened the class action lawsuit they filed in March 2013 on behalf of the residents of Miami, seeking to enforce the parties’ settlement agreement. The Motion to Enforce the Settlement Agreement asserts, in part, that FDOT breached the parties’ agreement by causing the scores of the community-based Aesthetics Review Committee to be diluted.
“The additional weight given to technical reviewers has effectively stifled the voice of the community. This is Miami’s equivalent of the Golden Gate Bridge or the Sunshine Skyway Bridge. It is only right that Miami-Dade residents should determine that iconic design, not state bureaucrats,” Sarnoff said. “It is unfortunate that it requires ongoing litigation to protect a process established by the settlement agreement.”
Sarnoff said FDOT should honor its commitment to allow Miami-Dade residents to decide the design of the signature bridge, which will become an enduring icon of Miami for decades to come. FDOT is seeking to award the $800 million contract to build a design that received “poor” and “fair” marks from the local review committee during the final scoring phase.
“This motion is about protecting a process that FDOT and the plaintiffs agreed to, it’s not about trying to dictate a result,” attorney Solowsky said. Added Pertnoy: “The simple fact is that the process required that the five-person Aesthetics Committee would be the sole scorers of aesthetics.”
Sarnoff’s 2013 lawsuit resulted in FDOT’s agreement to establish the Aesthetics Review Committee, made up of four local representatives and one FDOT representative, who were to serve as the sole scorers of aesthetics during the procurement process. A five-person technical review panel of FDOT and MDX engineers was established to ensure that all designs selected for final consideration met the technical standards outlined in the bid criteria. The four local members of the Aesthetics Committee considered all qualified proposals and were unanimous in their preference for the design that finished second overall.
Sarnoff said FDOT’s recent actions disregard the settlement by giving more weight to the views of road builders and engineers than to the judgment of local committee members specifically asked to consider the look and feel of competing design proposals.
The motion filed today says, “This community came together and loudly proclaimed with a unified voice its support of a Signature Bridge project. The Settlement Agreement implemented that voice. By casting additional votes, FDOT diluted the voice of the community.”
Sarnoff noted that the settlement agreement expressly required that five members serve on the Aesthetics Committee, including one FDOT representative, each with one vote – not a nine-member Aesthetics Committee that gives FDOT five votes. By casting additional votes FDOT improperly undermined the weight given to community input, he said.
Sarnoff said he filed his motion to ensure that Miami’s voice is heard and its choice is reflected by this enduring, iconic project, which will also serve to reknit together Overtown, breaking down walls that divided and destroyed the historic community.
“Our local representatives on the Aesthetics Committee took seriously the task of choosing a design that would mend the divide caused decades ago when FDOT built I-395 through the heart of Overtown, cutting it off from downtown Miami,” Sarnoff said. “Since FDOT agreed to let local voices be the sole voice on aesthetics, it must be held to that commitment. FDOT must follow the process that it agreed to.”
To view a copy of the Motion to Enforce, click here.

PSC Approves Settlement Agreement for Peoples Gas System

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The Florida Public Service Commission (PSC) today approved a Settlement Agreement offered by Peoples Gas System (Peoples Gas or Company) and the Office of Public Counsel (OPC), who represents Peoples Gas customers, that keeps base rates in place through 2020.

“The Settlement Agreement protects customers from any base rate increase through 2020,” said PSC Chairman Julie Brown.  “It also provides an opportunity for Peoples Gas to manage some critical projects, such as the environmental cleanup of its manufactured gas plants and replacement of plastic pipes.”

The Settlement Agreement stemmed from Peoples Gas’ original petition for approval of its 2016 Depreciation Study. OPC filed its response, proposing further adjustments to Peoples Gas depreciation rates. On December 15, 2016, Peoples Gas and OPC filed a Settlement Agreement outlining how their proposed adjustment of depreciation rates and modification to the Company’s return on equity would occur.  With the PSC’s approval, the agreement allows for the following terms:

  • Peoples Gas will not file a request for a general base rate proceeding before December 31, 2020, unless its earnings fall below 9.25 percent.
  • Establishes new depreciation rates and certain depreciation reserve transfers that are expected to result in a reduction in 2016 depreciation expense of $16.1 million.
  • Accelerates recovery of environmental cleanup and monitoring costs associated with former manufactured gas plants–old industrial facilities at which gas was produced from coal, oil, and other feedstocks. 
  • Expands Peoples Gas’ current accelerated cast iron and bare steel pipe replacement program to include “problematic plastic pipe” replacements,  which includes certain types of plastic pipe that was manufactured before 1983 and which have been found to become brittle under certain conditions.

Peoples Gas, Florida’s largest natural gas distribution utility, serves about 370,000 customers in Florida.

For additional information, visit www.floridapsc.com.

Follow the PSC on Twitter, @floridapsc.

Florida Signs a $1.5 Million Life Claim Settlement Agreement with Ameriprise Subsidiaries

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The Florida Office of Insurance Regulation (Office), Florida Department of Financial Services (DFS), and the Florida Office of the Attorney General (AG) today announced that a $1.5 million life claim settlement agreement has been reached with subsidiaries of the Ameriprise Group, RiverSource Life Insurance Company and RiverSource Life Insurance Company of New York.
The settlement agreement focuses on the one-sided use of the Social Security Administration’s Death Master File (DMF) to stop paying a deceased person’s annuity, but not using the same information to find and begin paying the deceased’s family or other beneficiaries for life insurance policies. The multi-state examination was conducted by California, which served as the managing lead state, Florida, New Hampshire, North Dakota, and Pennsylvania.
Florida’s allocation of the multi-state settlement payment by Ameriprise is over $111,000, which covers the costs of the investigations and future compliance monitoring. To date, state insurance regulators have either reached settlements or concluded the investigation of 28 of the top 40 companies constituting 80% of the total market. Efforts continue to be focused on the examination of the remaining 12 insurers.
Florida’s joint state agency effort was the catalyst for the development of the National Association of Insurance Commissioners’ Life/Annuities Claim Settlements Practices Task Force, which had been coordinating the national multi-state examinations of the top 40 life/annuity insurance companies since 2011. In the years since these efforts began, more than $7.3 billion in unknown or lost policy proceeds to beneficiaries have been returned directly by the companies and over $2.8 billion delivered to the states’ unclaimed property programs.
Effective July 1, 2016, Florida implemented comprehensive legislation requiring life insurance companies to search the DMF and compare the records of both current life insurance policies and those going back to January 1, 1992, when trying to find beneficiaries of a life insurance benefit. Senate Bill 966, championed by Chief Financial Officer Jeff Atwater (DFS) and signed by Governor Scott, strengthens the state’s unclaimed property laws for the protection of Florida consumers and provides life insurance companies with a standardized methodology for locating beneficiaries.
For more information, visit the Office’s “Life Claim Settlement Practices” webpage. To search or submit a request for unclaimed property, visit www.FLTreasureHunt.org, or call 1-88-VALUABLE or (850) 413-3089.
About the Florida Office of Insurance Regulation
The Florida Office of Insurance Regulation has primary responsibility for regulation, compliance and enforcement of statutes related to the business of insurance and the monitoring of industry markets. For more information about the Office, please visit www.floir.com or follow us on Twitter @FLOIR_comm and Facebook.