If approved by regulators, customers will directly benefit from new federal tax savings
TAMPA, January 30, 2018
Tampa Electric bills won't be rising to pay for Hurricane Irma restoration costs, thanks to new tax savings.
Because of recent changes made to the federal tax law, customers will directly benefit. If approved, what Tampa Electric would have paid in corporate income taxes will instead be used to cover the cost of restoring power after Hurricane Irma and several other earlier named storms. Additionally, Tampa Electric bills will reflect the ongoing benefits from tax reform starting in 2019.
In December, Tampa Electric filed with the Florida Public Service Commission (PSC) to seek about $88 million as a "temporary storm surcharge." For the average customer, who uses 1,000 kilowatt-hours (kwh) a month, that would have added $4 to their monthly bill beginning in March and continuing through the end of 2019. The utility has filed for permission to apply the federal tax reform savings towards the estimated storm costs and to replenish its storm reserve in 2018.
"This is a great solution for our customers," said Nancy Tower, president and chief executive officer of Tampa Electric. "Hurricane Irma impacted almost 70 percent of our system. I'm proud to say that -- along with our employees – more than 3,000 additional workers from 64 companies assisted us to safely restore power efficiently and quickly. Redirecting our tax savings to cover these storm costs is an opportunity for our customers to benefit from the tax law immediately."
The change is supported by the Office of Public Counsel and other consumer groups. "Consumers are eager to see rate reductions resulting from the federal tax changes, and with this implementation agreement, look forward to lower electric bills in early 2019," said J.R. Kelly, the state's public counsel, and Jon Moyle, representing the Florida Industrial Power Users Group.
The PSC is expected to vote on the issue March 1.
Tampa Electric, one of Florida's largest investor-owned electric utilities, serves about 750,000 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.
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