Public Service Commission approves Tampa Electric’s lower rates for 2012
Tampa Electric’s residential bills will remain well below national average
TAMPA, November 1, 2011
Tampa Electric customers will see slightly lower bills beginning in January 2012 due to lower costs for fuel and purchased power.
The Florida Public Service Commission (PSC) today approved Tampa Electric's request for a residential customer's monthly bill to drop to $106.90 for 1,000 kilowatt-hours (kWh), from the current $107.02 a month. Commercial customers will remain flat; industrial customers will see a slight decrease.
"Any decrease is a move in the right direction, and Tampa Electric is happy to give our customers the fourth consecutive reduction in fuel costs in the past three years," said Gordon Gillette, president of Tampa Electric. "After adjusting for inflation, Tampa Electric customers will be paying bills that are 17 percent lower than 20 years ago – compared to other staples, such as gasoline and bread, which have risen 99 percent and 21 percent, respectively, during that time."
Tampa Electric residential customers' bills will remain more than 8 percent below the national average – which is $116.80 per month, according to May 2011 data from the Energy Information Administration.
Due to lower projected fuel costs, the company estimates that by the end of 2011 it will spend $47 million less on fuel than originally projected. The decrease in the fuel portion of the bill is based on lower costs for natural gas and purchased power during the first six months of 2011, projections for the remainder of 2011 and expected fuel prices in 2012.
Tampa Electric's fuel mix is predominantly comprised of coal and natural gas. The cost of fuel is a substantial portion of an electric bill, currently almost 40 percent for residential customers. Tampa Electric makes no profit from the cost of fuel. Although the company cannot control the price of fuel, Tampa Electric maximizes the use of existing low-cost, well-performing plants and power purchased from other companies to mitigate costs and pass the savings to customers.
Today’s approval also included other costs, such as environmental expenses, which pay for pollution-control equipment, and energy-efficiency programs, such as the expanded list of programs now offered to customers.
Tampa Electric Company is the principal subsidiary of TECO Energy Inc. (NYSE: TE), an energy-related holding company with regulated utility operations in Florida, including both Tampa Electric and Peoples Gas System. Tampa Electric serves more than 672,000 customers in West Central Florida. Other subsidiaries include TECO Coal, which owns and operates coal production facilities in Kentucky and Virginia, and TECO Guatemala, which is engaged in electric power generation and energy-related businesses in Guatemala.
Note: This release contains forward-looking statements, which are subject to the inherent uncertainties in predicting future results and conditions. Actual results or outcomes may differ materially from those forecasted. The forecasted information is based on the company's current expectations and assumptions, and the company does not undertake to update that information or any other information contained in this release, except as may be required by law. Fuel prices are dependent on market conditions, and customer rates are dependent on many factors, including actions by the PSC. Additional information is contained under "Risk Factors" in TECO Energy, Inc.'s and Tampa Electric Company's combined Annual Report on Form 10-K.