The utility’s bills to remain among the lowest in Florida and significantly below national average
After significantly lowering bills during the pandemic, Tampa Electric is seeking to raise customer bills in 2021 to keep pace with the rising cost of natural gas. Bills would continue to remain well below the national average.
The pandemic initially caused reduced demand for natural gas, which drove prices to historical lows. As demand increases this winter and into 2021 due to an anticipated economic recovery, natural gas prices are expected to increase. Fuel costs are passed through from fuel suppliers to customers with no markup or profit to Tampa Electric.
The company today filed projected costs for fuel and other clauses with the Florida Public Service Commission (PSC), to take effect next year. The PSC is expected to vote on the adjustment after a hearing scheduled to begin Nov. 3.
“In 2020, we passed along savings to customers by lowering bills up to 11 percent for residential customers and 14 percent to 20 percent for commercial customers,” said Nancy Tower, president and chief executive officer of Tampa Electric. “Those savings will continue, as expected, through December.
“Our team is committed to supporting customers in need. We have been helping residential and business customers affected by the pandemic by connecting them to available financial resources, as well as providing flexible payment plans,” Tower said. “It’s important to note that this proposed adjustment will not take effect until January and is in line, and often lower, when compared to prices throughout the past 10 years.”
If the PSC approves the requests as filed, the average residential customer’s 2021 monthly energy bill would be $105.83 for 1,000 kilowatt-hours (kWh) of use, which is less than customers paid in 2018 and 19 percent below national average. It would be an increase of about 8 percent, or $8.14 per month, compared to current bills, which were lowered in June. Commercial and industrial customers would see bills increase between 7 percent and 12 percent compared to current bills, depending on usage. When compared to pre-pandemic prices, when natural gas prices were more stable, the increase for all customers is about 4 percent.
While the proposed increase is largely the result of rising natural gas prices, a portion of the impact is due to the recently approved Storm Protection Plan, which will install some power lines underground to increase our grid’s reliability during severe weather. It also includes the addition of a new utility-scale solar project that will come online in January.
The cost of fuel is currently about one-fourth of a residential customer’s bill. Tampa Electric maximizes the use of existing low-cost, well-performing plants and power purchased from other companies to mitigate costs. The fuel portion of the bill is based on actual costs during the first six months of 2020, projections for the remainder of 2020 and expected fuel prices in 2021.
Tampa Electric, one of Florida’s largest investor-owned electric utilities, serves about 780,000 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.
