Court says no to Florida utility charging for drilling plan

Published: Updated:
Credit: Florida Power & Light.

TALLAHASSEE, Fla. (AP) – Florida’s highest court on Thursday told state regulators that it was wrong to let the state’s largest utility charge its customers for the cost of an oil and gas drilling project in another state.

The Florida Supreme Court ruled 6-1 that there was no legal justification to allow Florida Power & Light to pass on expenses associated with an Oklahoma project that relies on fracking. The ruling could force FPL to eliminate a charge that now adds nearly $1 a month to residential bills.

FPL has said the investment would help save its customers money in the long haul and last year won approval to spend up to $500 million per year on these types of projects.

But Justice Ricky Polston, who wrote the opinion, stated that it was an “overreach” by the Public Service Commission to allow FPL to pass on the cost to its nearly 5 million customers in the state. The court determined that state legislators had placed limits on what kinds of costs can be passed on to consumers.

Polston said the investments by Florida Power & Light in oil and gas drilling “may be a good idea” but “whether speculative capital investments in gas exploration and production by an electric utility is in in the public interest is a policy determination that must be made by the Legislature.”

Jon Moyle, an attorney who represents industrial customers who challenged the proposal, called the decision good for consumers.

“They will not be forced to pay for risky oil and gas ventures in Oklahoma and elsewhere,” Moyle said.

Sarah Gatewood, a spokeswoman for Florida Power & Light, said the utility was “disappointed by the court’s decision given its potential long-term negative impact on customers’ bills.” She said FPL continues to back the Oklahoma project as a way to “provide rate stability and reduce risk for our customers.”

“We also believe the PSC was on solid ground in approving a utility’s natural gas investment used in the provision of electric service, and appreciate its careful consideration of this innovative approach,” Gatewood said.

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