Company passing savings on to customers for second year in a row
JUNO BEACH, FL. - Florida Power & Light Company said today that residential customers will see rates decline by nearly one percent beginning in January 2008 as a result of greater efficiency at fossil fuel generating plants. Industrial and commercial customers will also be paying slightly less on their monthly bills.
This is the second year in a row that FPL has reduced rates in spite of price volatility in world fuel markets and continued growth in demand for electricity throughout its service territory.
“We remain committed to doing everything we can to keep our rates as low as possible,” said FPL President Armando Olivera. “By increasing the efficiency of our network we’re making sure that we maintain reliable service while minimizing the impact of rising fuel prices.”
The company said current price projections could be altered by unforeseen events, such as a major hurricane striking the Gulf of Mexico. For example, when Hurricane Katrina damaged fuel production and transportation facilities in and around the Gulf two years ago, prices for natural gas and fuel oil used at FPL's power plants rose precipitously.
In its annual filings with the Florida Public Service Commission on fuel costs and related items, the company projected that starting next January, a residential customer using 1,000 kilowatt-hours (kWh) per month will see monthly bills decline by $0.94, to $102.49. In contrast, residential customers nationwide who use 1,000 kWh a month pay $108.79, according to the Edison Electric Institute, an industry trade association. FPL commercial and industrial customers will see reductions anywhere from just over half of one percent to nearly one percent on their monthly bills.
While FPL projects that natural gas prices will remain flat and residual oil fuel prices will increase moderately next year, a significant factor helping to drive down costs is increased fuel efficiency at FPL’s fossil fuel power plants. FPL’s fossil fuel power plant fleet is the top performer among large-scale utilities nationwide and has become 12 percent more efficient in the past five years. Efficiency at these facilities has grown by 17 percent since 1990.
As a fossil power plant increases in efficiency, it can generate the same megawatt hour with less fuel, thus saving money for FPL customers. Burning fuel more efficiently has the added benefit of emitting less greenhouse gases per megawatt hour produced. FPL’s power plants rank among the cleanest in the nation. FPL’s parent company, FPL Group Inc., has called for mandatory greenhouse gas emissions reductions, which contribute to man-made climate change.
The company reported that it will spend $6.1 billion for fuel in 2007 and projects it will buy $6.2 billion worth of fuel next year. FPL makes no profit on fuel and only actual costs are passed on to customers. Since 1975, electric utilities in Florida have made adjustment for fuel costs at least once a year with PSC approval, adjusting fuel surcharges so that customers pay only the actual fuel costs.
FPL has reduced the base rate portion of customer bills by 16 percent and saved customers $4.4 billion since 1999. Today the base rate – which covers what customers pay for electricity use -- accounts for 38 percent of the bill, while the fuel portion is 51 percent, nearly double what it was in 1999.
Florida Power & Light Company is the principal 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 nearly $16 billion and a growing presence in 26 states, FPL Group is widely recognized as one of the country's premier power companies. Florida Power & Light Company serves 4.4 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.