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Sierra Club files challenge to FPL rate settlement

The Sierra Club filed a lawsuit Jan. 17 with the Florida Supreme Court seeking to block the recently approved rate settlement for Florida Power & Light Co.

The Florida Public Service Commission in November 2016 approved a four-year rate settlement between FPL and key intervenors authorizing a base rate increase of $811 million by the end of 2019 and an increase in the midpoint of the utility's allowed return on equity to 10.55% from 10.5%.

The Sierra Club is asking the Florida Supreme Court to block the rate settlement on the grounds that it further contributes to FPL's "over-reliance on financially risky, climate-disrupting gas," according to a news release by the group. The Sierra Club also noted that FPL parent NextEra Energy Inc. is developing the 516-mile Sabal Trail pipeline to transport gas into central Florida, saying the project threatens local waterways, wetlands and the Floridan aquifer. Sabal Trail is a joint venture of NextEra, Spectra Energy Partners LP and Duke Energy Corp.

"The PSC is supposed to make sure our energy sources are safe, reasonable and reliable," Sierra Club Florida Chapter Chair Mark Walters said in the news release. "Instead, they've chosen to let FPL leave us vulnerable to price spikes when investments in solar and energy efficiency are proving to be safer and cheaper in states across the country."

The FPL rate settlement does allow base rate increases associated with adding up to 300 MW annually of solar capacity over the next four years, and terminates the utility's natural gas hedging program, a key condition sought by the Florida Office of Public Counsel. The OPC has argued the natural gas hedging programs by Florida's four major investor-owned utilities have cost ratepayers billions.

FPL spokesperson Sarah Gatewood described the Sierra Club as "an extreme group that takes extreme positions," in an email responding to the lawsuit.

"Apparently they're more interested in generating headlines and donations than working with the cleanest electric company in Florida and the only electric utility in the Southeast United States to already be in compliance with the EPA's 2030 Clean Power Plan today," she added. "The settlement supports billions of dollars in planned investments to continue improving FPL's electrical infrastructure, which is already one of the cleanest and most reliable in the U.S., while still keeping typical customer bills lower than they were in 2006 through 2020. We look forward to demonstrating those benefits yet again."