Regulators Sign Off On Duke Hurricane Costs
With little discussion, the state Public Service Commission on Tuesday approved an agreement that will allow Duke Energy Florida to use savings from a 2017 federal tax overhaul to cover Hurricane Michael power-restoration costs.
The agreement will shield Duke customers from having extra charges tacked onto their monthly bills to pay for restoring and rebuilding the electric system after the Category 5 hurricane in Northwest Florida.
It also will mean, however, that the utility will not pass on savings to customers from the tax overhaul, which, among other things, reduced the corporate income-tax rate from 35 percent to 21 percent. Duke reached the agreement with the state Office of Public Counsel, which represents consumers on utility issues, and other parties in the case.
“This is a good opportunity to use the tax savings to pay for a catastrophic event,” Deputy Public Counsel Charles Rehwinkel said before the commission approved the plan. The plan involves using $223.5 million in tax savings to cover Hurricane Michael restoration costs and replenish a storm reserve.
Duke serves customers in areas such as Bay, Gulf, Franklin and Wakulla counties that were hit by Hurricane Michael in October. The Public Service Commission last month also approved a settlement agreement that allows Duke to use tax savings to cover costs related to 2017’s Hurricane Irma and Hurricane Nate.