Florida PSC Scraps Costly Energy Conservation Program

Published August 29, 2011

The Florida Public Service Commission (PSC) has pulled the plug on an aggressive—and expensive—plan by Florida Power & Light to prod its customers into meeting the company’s ambitious conservation goals.

PSC Changes Course

Earlier this year the PSC had approved the plan, but it changed course when it determined the program would impose higher power bills on too many customers. Under the plan, ratepayers would have been given energy-efficient light bulbs and water heater blankets at no charge, plus rebates for tune-ups and replacement of older appliances that use large amounts of electricity. The PSC, in a decision announced July 27, determined the program’s cost exceeded its benefits, especially for those living on a tight budget. 

After the program received the original nod of approval from the PSC, concerns were raised, including by Gov. Rick Scott (R), that the plan imposed burdens that couldn’t be justified. Florida’s unemployment rate is 10.6 percent, and any measures imposing additional costs on ratepayers are viewed by Florida policymakers with strong concern. 

Business groups also weighed in, saying Florida Power & Light’s energy-efficiency program would substantially raise their electricity bills and siphon off money that could be used to expand companies and hire new workers. 

Let Consumers Decide

“One of the silliest fads in electricity regulation is forcing energy efficiency programs on ratepayers,” said Dan Simmons, director of state policy at the Washington-based Institute for Energy Research. “Study after study has shown these programs do not reduce electricity consumption, but that doesn’t stop utilities from pushing energy efficiency programs.

“Electrical utilities like these schemes because they allow them to raise rates and dole out energy-efficiency goodies to a few selected ratepayers. In the end, customers pay higher rates and get zero benefits,” Simmons explained.

“It is great to see that the Florida Public Service Commission recognized that ratepayers are smart enough to make such decisions on their own without being bullied by bureaucrats,” said Simmons.

Bonner R. Cohen, Ph. D. ([email protected]) is a senior fellow at the National Center for Public Policy Research.