Regulators approve reduction of Tampa Electric bills in January
Residential bills will remain among Florida’s lowest and 19 percent below the national average
TAMPA, November 2, 2016
Tampa Electric customers will pay $1.54 less a month for electricity in January – even as a new, efficient power plant begins serving customers. The Florida Public Service Commission approved the reduction unanimously at a hearing today.
A residential customer’s monthly bill will drop by $1.54, to $104.68 for 1,000 kilowatt-hours (kWh), about a 1.45 percent decrease from the current $106.22 a month. Commercial and industrial customers will see bills decrease by 5 percent and up to 10 percent, respectively.
Tampa Electric residential customers’ bills will remain 19 percent below the national average for 1,000 kWh usage – which is $129.20 per month, according to June 2016 data from the Energy Information Administration.
“Many times when a utility adds a large new asset like a power plant, bills go up – but in this case, they’re going down. Tampa Electric is very proud of that,” said Gordon Gillette, president of Tampa Electric. “We are proud to provide outstanding value to our customers every day with rates that are 19 percent lower than the national average.”
The bill reduction comes from this: On Jan. 16, the average Tampa Electric residential customer bill will increase by $6.68, when the Polk Power Station’s efficient combined-cycle natural gas unit becomes operational. However, the Jan. 1 reduction for fuel and other clauses – of $8.18 – will more than offset that increase, ending with a net reduction of $1.54 a month for the average residential customer.
Low natural gas prices are driving the offset. The company estimates that by the end of 2016 it will spend $98 million less on fuel than originally projected. The fuel portion of the bill is based on costs for natural gas and coal during the first six months of 2016, projections for the remainder of 2016 and expected fuel prices in 2017.
Tampa Electric’s fuel mix is predominantly comprised of natural gas and coal. The cost of fuel is a substantial portion of an electric bill, currently about one-third of a residential customer’s bill. Fuel costs are passed through from fuel suppliers to customers with no markup or profit to Tampa Electric. 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.
Tampa Electric, one of Florida’s largest investor-owned electric utilities, serves about 730,000 customers in West Central Florida. Tampa Electric is a subsidiary of Emera Inc., a geographically diverse energy and services company headquartered in Halifax, Nova Scotia, Canada.