Florida judge reverses approval of storm plans for Duke Energy and TECO
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Florida judge reverses approval of storm plans for Duke Energy and TECO

Florida’s Supreme Court on Thursday rejected a challenge to state regulators’ approval of long-term energy plans aimed at strengthening the electric system to better withstand hurricanes.

Justices upheld a unanimous decision by the Florida Public Service Commission in 2022 to approve so-called “storm protection plans” for Florida Power & Light, Duke Energy Florida, Tampa Electric Co. and Florida Public Utilities Co.

Under a 2019 law passed after Hurricane Irma, Hurricane Michael and other storms caused widespread power outages, electric companies submit 10-year storm protection plans to the commission and can seek money from customers annually to implement the plans.

The State Office of Public Counsel, which represents consumers in public utility matters, went to the Supreme Court after the 2022 approvals. In part, it argued the commission erred by failing to consider whether projects included in utilities’ plans were “prudent” — a common requirement in other types of utility matters.

But the Supreme Court, in a 27-page opinion written by Attorney General John Couriel, said the commission “properly reviewed and approved the companies’ proposals after concluding that they are in the public interest.” It said the cost prudence issue is part of a separate process in which utilities are seeking approval to recover money from customers.

“In sum, the commission’s work in determining what is in the public interest is different from the work it does in determining whether a company acted prudently,” Couriel wrote. “It makes these decisions at different times, taking into account different statutory factors. … The Commission is right that the SPP (storm protection plan) statute requires a review of the companies’ SPPs to determine whether they are in the public interest and not about the investments they suggests is, in the sense in which the expression has been used in this carefully drafted statute, prudent.”

In a brief filed last year, the Office of Public Counsel argued that the justices should overturn approval of the plans and send them back to the commission for cautionary consideration.

“As these orders stand now, customers are financially obligated for at least the next 10 years, including future SPP documents if not addressed here, to pay for storm hardening projects that may or may not be prudent,” the letter said. “This abdication of the commission’s duty creates a risk of harm to customers and a violation of the law, which the court must reverse and remand for further proceedings.”

Prior to the 2019 law, utilities incorporated such costs into their base electricity rates. Storm protection plans can include things like putting power lines underground and making improvements to above-ground systems.

Thursday’s statement came after Hurricanes Debby, Helene and Milton this year knocked out power to residents and businesses in many parts of the state. Florida Power & Light has filed a request with the commission to recover money from customers related to restoring power after the hurricanes, while Duke and Tampa Electric have said in financial reports that they also plan to seek similar costs.

These costs are separate from money that companies can try to recoup when implementing storm protection plans.