The Florida Public Service Commission: Smart Meters, Fracking and the Love Fest

The Florida Public Service held its last Commission Conference Agenda Meeting for the year on  December 18, 2014. On the Agenda were two important items for Florida ratepayers – the challenge to FPL’s smart meter opt out fees and the inclusion of FPL’s oil and gas exploration (fracking) investment in the rate base for recovery through the fuel clause.

The Commission meeting and the following Internal Affairs meeting was more of a love fest than a meeting, as they each gave their lengthy send off remarks for two members of the team – Commissioner Balbis, who chose not to seek another term and FPSC General Counsel Kirk, who is retiring.

Balbis gave a speech of his proud accomplishments of his four years claiming customers have benefited from a “stable regulatory environment”.  He bragged about the goodness he sees in the controversial nuclear recovery costs clause stating it has saved $3 Billion in fuel costs and took the equivalent of 7 million cars off the roads by removing carbon emissions.

The biggest chuckle I got is when he thanked his colleagues “for their patience with me asking a question of every single witness”. This is a lie and I can prove it. On September 30, 2014 in that same very room, almost 3 months ago to the day, I was sworn in as a witness in Docket 130223, was given a paltry 3 minutes to summarize my pre-filed testimony, and then when it was time for questions not one Commissioner or their staff asked one question. I guess the cat got his tongue that day.

Docket No. 130223 is FPL’s smart meter opt out fees, which I filed a formal protest against on February 4, 2014. Staff issued their recommendation a few weeks ago calling for a couple of adjustments that would reduce the upfront fee from $95 to $89, a whopping  $6. Staff ignored many of the arguments before them; instead their analysis just parroted what FPL said. I’ll write in more detail about that another day, particularly how they doubled-down on an incorrect adjustment in their latest recommendation.

A few days ago I received the Conference Agenda for todays meeting. Of the 15 items on the agenda, all but three had double asterisks beside them, denoting they would be handled as consent agenda items (no discussion). I was relieved to see that Docket 130223 did not have such asterisks, so I expected at least some discussion. Wrong! I guess Commissioner Balbis had run out of questions – for at the start of the meeting they put the smart meter docket into the consent agenda pool. (They have a lot of discretion to do as they please.) The staff recommendation was quickly rubber stamped and approved with no discussion.

FPSC General Counsel Kirk’s love fest speech talked about the dysfunctional Commission of 5 years ago and their “lack of civility” and how much better it was now. He bragged about how the FPL settlement appeal win was a huge decision. In the electric utility market he predicted change similar to that of the telephone industry. Citing his work as a state legislator, he reminisced about his legislation to bring forth peak load pricing. Then he did a no-no. He let the cat out of the bag. He said that the investment in smart meters would now make peak load pricing easier. I guess the truth always comes out eventually.

The Commission also took up the FPL fracking investment issue. This was the fun theater of the day. The script was written in advance to put Balbis up as the chief proponent of this project. Why, you ask? Well, because he is leaving in 12 days, of course. If it goes sour in the next few years, you can point to the man that is no longer there. Each of the others brought up their hesitations pretending to put up some resistance and thoughtful oversight – the contract term is too long, the accounting might not be transparent, who will do the audit?

The best actor award will go to Brise. There were four issues/questions being considered. The first one they tackled was Issue #6 – whether the 2012 rate case settlement agreement precluded FPL from seeking to increase rates as it proposes. When they voted on that issue, Brise voted Yes – meaning that he believed the settlement agreement precluded FPL from seeking rates for this issue. All the other Commissioners voted No.

Edgar so concisely stated before the vote why they were taking up Issue #6 first. Because if the vote was that the majority of the Commissioners felt the settlement agreement precluded this increase, then the other issues are moot.

So how did Brise vote on whether to allow rate recovery for this proposal after the first vote? Well, he concedes he lost the first battle and then votes in line with the others to unanimously approve all the other issues. What? Yes, he believes the rate case settlement precludes FPL from seeking rates on this investment BUT he believes the Commission should approve FPL’s request for cost recovery. Folks, that is what is meant by “civility” – getting along, showing solidarity is much more important than the facts and your convictions to how you see the facts.

There are other supporting actor awards to give out, like Brown’s statements of prudency. She poses very important questions regarding risks for rate payers if state legislators act unfavorably on fracking, for which the legal staff answers, after a long period of silence, “I don’t know” and then she smoothly doesn’t seem to care that she doesn’t get an answer and powers on and votes for it anyway. Once I figure out how to get video clips off the site, I think I can make a pretty good award video.

Not to be out done, they had a rival love fest today in California too for their outgoing Chairman Peevey. He was caught up in just a little scandal of participating in judge shopping for the California utilities. One would think that little event, discovered through freedom of information requests for e-mails, would get you fired for ethic violations. But no, he got to keep his job until the end of his term and throw himself a love fest. California, after a three-year review, also voted today to keep their smart meter fees that were being challenged by the public. But at least they had discussion AND public comments on the issue, unlike the Florida cowards.

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