FPL to cut spending as the PSC cuts rate hike
By Palm Beach Business.com
JUNO BEACH — The Florida Public Service Commission cut Florida Power & Light’s rate hike request from $1 billion to $75 million and denied an increase for 2011 altogether.
FPL, citing the decision and what it called a “deteriorating regulatory and business environment," said it will immediately suspend about $10 billion worth of construction projects that had been planned for the next five years.
“Historically, Florida has enjoyed a constructive regulatory environment, which has allowed us to invest billions of dollars to benefit FPL customers while having reasonable confidence that our investors would be allowed to earn fair returns.” FPL Group Chairman and CEO Lew Hay said in a statement.
The PSC made several adjustments to the company’s expenses, including depreciation and salaries and benefits. Regulators also reduced FPL’s return on equity from its requested 12.5 percent to 10 percent.
New FPL base rates will be addressed on Jan. 29. The commission staff is scheduled to file its FPL rate recommendation on Jan. 22.
FPL said it will immediately suspend:
The projects directly and indirectly would have created about 20,000 construction and construction-related jobs over the next five years, according to FPL.
FPL will also assess the cost of ongoing operations and review other capital investments. The company expects to make any decisions by the end of the second quarter.
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