Starting January 2025, customers of Florida Power & Light (FPL) might see an increase in their monthly bills as the utility company seeks approval to collect nearly $1.2 billion to cover power restoration costs following the impact of four hurricanes in the region.
According to a document submitted to the Florida Public Service Commission, FPL aims to recover about $1,179 million over a 12-month period beginning in January. This move is attributed to the damage from Hurricane Idalia, a Category 3 storm that struck Florida in August 2023, as well as Hurricane Debby, a Category 1 storm. Additionally, Hurricanes Helene, a Category 4, and Milton, a Category 3, hit the state within a two-week span in September and October of the same year.
"The four hurricanes resulted in more than 3 million power outages for FPL customers due to damaging winds, storm surges, and, in Milton's case, dozens of unusually powerful and long-tracked tornadoes," as noted in the document.
Potential Financial Impact on Customers
A report from the Miami Herald indicates that the Public Service Commission would need to approve this financial recovery for FPL, which is not uncommon, as similar utilities have regularly received such approvals in the past. The proposed plan by FPL would add approximately $12.02 to the monthly bill of a typical residential customer using 1,000 kWh. This surcharge is expected to last for 12 months, allowing FPL to recoup roughly $1.2 billion in restoration expenses and replenish its storm reserve, which was depleted by Hurricane Idalia and exhausted after Hurricane Debby.
FPL maintains that its rates will remain competitive on a national level. This surcharge is intended to address restoration costs promptly, reducing the chance of additional surcharges if more storms strike in 2025.
Investments in Technology and Infrastructure
"We understand that customers bear these restoration costs, which is why we continue to invest in smart grid technology and storm protection," stated Armando Pimentel, FPL's president and CEO, in a statement on Tuesday. "These efforts prevent many outages, speed up restoration, and lower restoration costs, helping customers recover faster, from getting kids back to school to restarting Florida's economy," Pimentel emphasized, highlighting the company's relentless work to restore power swiftly after each hurricane.
The company claims that its investment in smart grid technology and infrastructure improvements prevented nearly 900,000 power outages and significantly reduced restoration times after each storm.
Financial Breakdown and Reserve Replenishment
In its presentation to the Public Service Commission, FPL estimated costs of approximately $811.1 million for Hurricane Milton, $157.8 million for Helene, and $113.5 million for Debby. These expenses would be partially offset by a storm reserve of around $75.4 million that the utility had before Debby.
Additionally, FPL seeks to raise $150 million to replenish this storm reserve and cover related interest costs.