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Progress Energy Wants To Raise Electric Bills 8%

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By RUSSELL RAY | The Tampa Tribune

Published: May 30, 2008

Electric bills for customers of Progress Energy Florida would jump by more than $8 a month under a plan filed today with state regulators.

Citing the higher cost of coal, natural gas and oil, the St. Petersburg-based utility asked the Florida Public Service Commission for permission to recover the increased costs from customers. If approved, the 8 percent increase would be applied to customers' bills beginning in August.

Residential customers who use 1,000 kilowatt hours a month would pay $8.68 more each month for a monthly bill of $116.79, under the proposal.

Electric utilities do not make a profit on fuel. The costs are passed on to customers with no markup.

Coal is used to produce 32 percent of the utility's electricity; oil accounts for 7 percent. The company pointed to a 15 percent increase in the cost of coal and a 32 percent increase in the cost of oil since last fall.

"We know that these expenses are a burden on our customers," Jeff Lyash, president and chief executive of Progress Energy Florida, said in a statement. "Our balanced approach to meeting energy demand includes a diverse mix of fuels to generate electricity. Together with our fuel-hedging practices, we are mitigating cost increases and price volatility for our customers."

In August, the utility will stop recovering from customers a charge related to hurricane damage in 2004. The fee amounts to $3.61 per 1,000 kilowatt hours of consumption.

Progress Energy provides power to nearly 1.7 million customers in 35 counties, including Pinellas, Pasco and Polk counties.

A midyear adjustment in fuel costs is allowed when a utility underestimates or overestimates its fuel costs for the year by more than 10 percent. Tampa Electric said it has no plans to seek a midyear increase in fuel costs.

Reporter Russell Ray can be reached at (813) 259-7870 or rray@tampatrib.com.

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