Thursday, October 23, 2014

Wednesday, January 6, 2010

FPL Goes for a Hike

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After reading a South Florida Sun Sentinel article about Florida Power & Light arguing for a rate hike, I wrote FPL to see what they were arguing about…

Dear Those Who Power & Light Florida:

There was a very disturbing article in the paper recently. It alleges that Florida Power & Light is proposing to bill customers millions of dollars for marketing and administrative costs. If the article is accurate, I’m all for doing less marketing. Just shut that operation down right now. Everyone knows if they need power or light, they’re stuck with you. If they already know, why beat a dead horse, which is against the law in this country?

Please explain this: Your annual revenues exceed $15 Billion annually … and you can’t afford to pick up the marketing and administrative tab? You’ve got enough to worry about just keeping the lights on. Do you realize how many times they go out? Even with all the lights on, many people in Florida are still in the dark, so we don’t need any additional help from you on that front.

How do you justify passing these costs on to consumers? I understand that you want to pass on $3.7 million of nearly $5 million that you project you’ll be spending just to argue in favor of rate increases alone. That’s an expensive argument. I argue with people all the time and don’t charge a dime. Stop arguing so much — maybe even take a few anger management classes — and you’ll save millions, which can then be spent on upgrading your transmission stations to keep the power and lights on every time it rains hard.

Less power to you, at least when it comes to marketing and rate increases. Convince me that I’m wrong.

In a letter dated December 29, 2009 an FPL Corporate Resolution Specialist responded with:

This letter is in reference to your recent correspondence to Florida Power & Light dated December 7, 2009 regarding our marketing and administrative costs during our rate proposal.

We are running ads because it’s important that the public has a chance to understand the facts of our request. A negative outcome in the rate proceeding puts at risk thousands of new construction jobs at a time when they are needed most, hundreds of millions of dollars in new tax revenues for Florida communities, and billions of dollars in capital investment. All of which can be accomplished while lowering typical customer bills.

Customers also need to know the facts about FPL. FPL’s bill is the lowest of all 54 utilities in Florida, saving customers an average of more than $340 a year. We know that means a lot to our customers, especially in this difficult economy.

FPL recently announced that we expect to reduce the typical 1,000 kilowatt-hour residential bill about $9 a month in 2010, subject to approval by the FPSC. This would result in the bill decreasing from approximately $109 in December 2009 to approximately $100 in January 2010. This estimate includes the impacts of our pending request for a base rate adjustment, lower projected fuel prices and improvements in fuel efficiency at our power plants. The current request would result in 2010 typical bills being the lowest in four years.

I also want you to know that FPL has not had a general base rate increase since 1985. In fact, our base rates have declined 17 percent since — from $47.15 in 1985 to $39.31 today — despite inflation of 99 percent during the same period. In addition, FPL’s distribution reliability is 47 percent better than the national average. We are also recognized as a clean energy leader and are moving forward aggressively to make Florida No. 2 in solar energy in the country.

Enclosed is a Fact Sheet that includes additional information regarding FPL’s request for a rate adjustment. I encourage you to take the time to review the sheet in detail. Please be sure to contact me at (phone number followed), if you would like to discuss this further or if I may be of assistance to you.

Final Thoughts: Bravo to Florida Power & Light for presenting their case with so much power, especially given the heavy subject matter, which in many ways is also light. I not only respect the Corporate Resolution Specialist for defending FPL’s position, but for providing a phone number for further conversation as well. What more can you ask?

This is the South Florida Sun Sentinel original FPL article that triggered my letter. Since then, Public Service Commission staffers recommended the regulatory agency approve less than one-third of what FPL proposed. Here’s the update on that. The commission vote on the rate proposal is scheduled for January 13, 2010.

When a business, service or product you use is in the news, one way to get the facts first-hand is to Write The Company.

Update: January 13, 2010 – Regulators slash FPL ‘s rate-hike request

January 14, 2010 – FPL halts work on major projects in response to PSC rate-hike rejection

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