Tampa Electric files to lower bills for 2013; fifth consecutive reduction
Residential bills would be among Florida’s lowest and would remain below national average
TAMPA, August 31, 2012
Tampa Electric customers could see lower bills beginning in January primarily due to lower costs for natural gas – the fifth consecutive reduction in fuel costs in the past four years.
The company today filed projected costs for fuel and other clauses with the Florida Public Service Commission (PSC). If the PSC approves the request as filed, a residential customer’s monthly bill would drop $4.32 to $102.58 for 1,000 kilowatt-hours (kWh), a 4 percent drop from the current $106.90 a month. Commercial customers would see bills drop by nearly 5 percent; industrial customers would remain flat.
“In these challenging economic times, we are pleased to continue to maintain low, stable bills while providing outstanding value to our customers,” said Gordon Gillette, president of Tampa Electric. “With one of the lowest rates in Florida, Tampa Electric is proud to serve you every day for less than half the average cost of lunch, while generating electricity responsibly from domestic fuels.”
If approved as filed, Tampa Electric residential customers’ bills would fall to about 14 percent below the national average – which is $119 per month, according to May 2012 data from the Energy Information Administration.
The PSC is expected to vote on the issue after a hearing scheduled to begin Nov. 5.
Due to lower projected fuel costs, the company estimates that by the end of 2012 it will spend $69 million less on fuel than originally projected. The decrease in the fuel portion of the bill is based on lower costs for natural gas during the first six months of 2012, projections for the remainder of 2012 and expected fuel prices in 2013.
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 filing also includes projections for other costs, including environmental expenses, which rose slightly but were more than offset by the reduction in natural gas prices.
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 nearly 676,000 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.