Tampa Electric customer bills to drop in January to reflect reduced fuel costs
Residential bills will remain among Florida's lowest and 22 percent below the national average
TAMPA, September 1, 2015
Thanks to lower natural gas prices, Tampa Electric customers could pay $2.25 less a month for electricity in January than they do today – even after a slight increase later this year that's part of a phased in rate settlement.
The company today filed projected costs for fuel and other clauses with the Florida Public Service Commission (PSC). If the PSC approves the requests as filed, a residential customer's monthly bill will drop by $2.25, to $106.22 for 1,000 kilowatt-hours (kWh), about a 2.1 percent decrease from the current $108.47 a month. Commercial and industrial customers would see bills decrease by 3.0 percent and 4.8 percent, respectively.
"Tampa Electric continues to have some of the lowest rates in Florida and our rates are 22 percent lower than the national average," said Gordon Gillette, president of Tampa Electric. "We are proud to provide outstanding value to our customers every day – the average residential customer can power their home for less than $3.50 a day or less than the cost of a gallon of milk."
In November, the average Tampa Electric residential customer bill will rise by 45 cents, as part of the 2013 rate settlement that culminates in 2017 with the addition of an efficient combined-cycle natural gas unit that will bring 460 additional megawatts of power to serve customer needs. The January reduction for fuel and other clauses – of $2.70 – would more than offset that increase, ending with a net reduction of $2.25 a month for the average residential customer from what they pay today.
The PSC is expected to vote on the fuel and other clauses after a hearing scheduled to begin Nov.2. If the fuel request is approved as filed, Tampa Electric residential customers' bills would remain more than 22 percent below the national average for 1,000 kWh usage – which is $129.50 per month, according to May 2015 data from the Energy Information Administration.
The company estimates that by the end of 2015 it will spend $2 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 2015, projections for the remainder of 2015 and expected fuel prices in 2016.
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, is part of the TECO Energy family of companies. Tampa Electric serves more than 700,000 customers in West Central Florida. TECO Energy Inc. (NYSE: TE) is an energy-related holding company with regulated electric and gas utilities in Florida and New Mexico: Tampa Electric, Peoples Gas System and New Mexico Gas Co. Other TECO Energy subsidiaries include TECO Coal, which owns and operates coal-production facilities in Kentucky, Tennessee and Virginia.
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.