TALLAHASSEE — The state’s utility regulators today unanimously approved a deal in which Tampa Electric Co.’s customers will initially pay about half of an proposed rate increase.
The Public Service Commission voted 5-0 to accept a proposed settlement agreement agreed to by TECO and interested parties. The company backed off of a requested 10 percent yearly rate increase and agreed to spread smaller increases over the next few years.
Groups representing industrial, retail, military and hospital interests had joined with the Office of Public Counsel, the state’s utility watchdog, to oppose the original increase and agreed to the settlement.
“It feels good to sit back and look at the table and see everybody singing ‘Kumbaya,’” Commissioner Art Graham said, smiling. “It makes my job a whole lot easier.”
The compromise includes an initial increase of 5.5 percent starting Nov. 1, which means a typical residential customer using 1,000 kilowatt hours a month would pay an extra $5.67, up from $102.58 to $108.25.
The original request, which would have generated an additional $134.8 million a year for TECO, would have meant an extra $10.41 on the same bill.
TECO’s lawyers also mentioned the company still is in a quest to entice a mystery company that could become the utility’s biggest customer.
That potential customer’s identity is a secret under a state law that allows the name to be considered TECO’s “proprietary confidential business information.”
Commissioners had approved a special contract between TECO and the business, which is “considering building a large manufacturing facility” somewhere in the utility’s service area.
TECO serves more than 687,000 residential, commercial and industrial customers in Hillsborough County and parts of Polk, Pasco and Pinellas counties.
The agreement approved today allows for rates to rise again in November 2014 to generate another $7.5 million, and again in November 2015 for another $5 million.
That translates into another $1.09 monthly for 2014-15 and 46 cents monthly for 2015-16 for the 1,000 kilowatt hour residential customer.
The parties also agreed TECO may charge customers an extra $110 million in 2017 to pay for improvements that will make electricity generation more efficient.
But for an emergency or other compelling reason, TECO is barred from requesting any more rate increases until the beginning of 2018.
It also removes a storm damage cost recovery charge that will save customers another $8 million a year, but allows it to be reinstated after a major storm.
The settlement does not include increases for fuel and other charges, which the PSC will decide in November, according to TECO.
When including those extra costs along with the new rates, the average residential bill could bump up another $1.27, to $109.52.