Florida Public Service Commission native order document 02374-2023

OCR transcription for search; preserved printed pages are authoritative

FILED 3/23/2023 DOCUMENT NO. 02374-2023 FPSC - COMMISSION CLERK
BEFORE THE FLORIDA PUBLIC SERVICE COMMISSION
In re: Petition for limited proceeding for recovery of incremental storm restoration costs related to Hurricanes Ian and Nicole, by Florida Power & Light Company.
DOCKET NO. 20230017-EI ORDER NO. PSC-2023-0110-PCO-EI ISSUED: March 23, 2023
The following Commissioners participated in the disposition of this matter:
ANDREW GILES FAY, Chairman ART GRAHAM GARY F. CLARK MIKE LA ROSA GABRIELLA PASSIDOMO
ORDER APPROVING FLORIDA POWER & LIGHT COMPANY'S PETITION FOR RECOVERY OF INCREMENTAL STORM RESTORATION COSTS FOR HURRICANES IAN AND NICOLE AND APPROVING CONSOLIDATED INTERIM STORM RESTORATION RECOVERY SURCHARGE
BY THE COMMISSION:
Background
On January 23, 2023, Florida Power & Light Company (FPL or Company) filed a petition for a limited proceeding seeking authority to implement an interim storm restoration recovery charge to recover $1.3 billion for the incremental restoration costs related to Hurricanes Ian and Nicole and to replenish the storm reserve. This amount includes $18.8 million in interest.
FPL has also presented an alternate storm charge calculation in its petition. This alternate calculation combines the recovery of incremental storm costs associated with Hurricanes Ian and Nicole with the remaining amounts to be collected for Hurricanes Michael, Sally, and Zeta, which we previously approved for recovery by Gulf Power Company (GPC or FPL's Northwest Florida).1 This alternate calculation estimates a total of $1.5 billion for incremental restoration costs related to Hurricanes Michael, Sally, Zeta, Ian, and Nicole and to replenish the storm reserve. This amount includes $21.6 million in interest.
1Order No. PSC-2019-0221-PCO-EI, issued June 3, 2019, in Docket No. 20190038-EI, In re: Petition for limited proceeding for recovery of incremental storm restoration costs related to Hurricane Michael, by Gulf Power Company; and Order No. PSC-2022-0406-FOF-EI, issued November 21, 2022, in Docket No. 20200041-EI, In re: Petition for limited proceeding for recovery of incremental storm restoration costs related to Hurricane Sally, by Gulf Power Company.

ORDER NO. PSC-2023-0110-PCO-EI
DOCKET NO. 20230017-EI
PAGE 2
FPL filed its petition pursuant to the provisions of the 2021 Settlement Agreement (2021
Settlement), which we approved in the Company’s most recent rate case. 2 Pursuant to the 2021
Settlement, the Company can recover storm costs on an interim basis beginning 60 days
following the filing of a petition for recovery. FPL has proposed interim storm restoration
charges applicable to all rate classes over a 12-month recovery period, effective with the first
billing cycle of April 2023, subject to a final true-up.
We have jurisdiction over this matter pursuant to Sections 366.04, 366.05, 366.06, and
366.076, Florida Statutes.
Decision
FPL filed a petition for a limited proceeding seeking authority to implement an interim
storm restoration recovery charge to recover an estimated total of $1.3 billion for incremental
restoration costs related to Hurricanes Ian and Nicole and to replenish the storm reserve. In its
petition, FPL requested to replenish the storm reserve to the pre-storm level of $219.9 million.
The petition was filed pursuant to the provisions of the 2021 Settlement we approved in
Order No. PSC-2021-0446-S-EI. Storm restoration costs for Ian and Nicole were incurred during
the term of the 2021 Settlement. Pursuant to Paragraph 10 of the 2021 Settlement, FPL can begin
recovery of storm costs 60 days following the filing of a petition for recovery.
FPL is seeking approval of interim storm cost recovery surcharges associated with
Hurricanes Ian and Nicole as shown in proposed tariff sheet No. 8.030.7 (Appendix F to the
petition). The surcharges would be applicable to all rate classes and customers served by FPL,
including customers previously served by GPC.
FPL also prepared an alternate storm charge calculation seeking authority to implement
an interim storm restoration recovery charge to recover an estimated total of $1.5 billion. This
alternate calculation combines the incremental restoration costs related to Hurricanes Ian and
Nicole with the remaining amounts to be collected for Hurricanes Michael, Sally, and Zeta,
which we previously approved for recovery by GPC, 3 and to replenish the storm reserve.
Current bills for FPL’s Northwest Florida customers include surcharges for Hurricanes
Michael and Sally, which equate to $8 and $3 on the residential 1,000 kilowatt-hour (kWh) bill,
respectively. The Hurricane Michael surcharge went into effect in July 2019 and was approved
to terminate in October 2023. Once the Hurricane Michael surcharge terminates, the $3/1,000
kWh residential Hurricane Sally surcharge will increase to $10/1,000 kWh. Once recovery of
Hurricane Sally is complete in October 2024, the recovery of Hurricane Zeta ($9.34/1,000 kWh)
will occur in the months of November and December 2024. These hurricanes impacted GPC’s
service territory prior to the merger of FPL and GPC. Tariff sheet Nos. 8.030.4, 8.030.5, and
8.030.6 show the currently approved surcharges for Michael, Sally, and Zeta, applicable to FPL’s
2Order No. PSC-2021-0446-S-EI, issued December 2, 2021, in Docket No. 20210015-EI, In re: Petition for rate
increase by Florida Power & Light Company.
3Order Nos. PSC-2019-0221-PCO-EI; and PSC-2022-0406-FOF-EI.

ORDER NO. PSC-2023-0110-PCO-EI
DOCKET NO. 20230017-EI
PAGE 3
Northwest Florida customers. FPL indicated in its calculations in Appendix A of the petition that
the storm costs associated with the Hurricane Michael surcharge are expected to be fully
recovered by March 31, 2023.
In its petition, FPL asserted that it incurred total retail recoverable costs of approximately
$1.5 billion as a result of Hurricanes Michael, Sally, Zeta, Ian, and Nicole. The Company further
asserted 	that 	this 	amount 	was 	calculated 	in 	accordance 	with 	the 	Incremental 	Cost 	and
Capitalization Approach methodology prescribed in Rule 25-6.0143, Florida Administrative
Code.
The current storm surcharges for Sally and Zeta applicable to FPL’s Northwest Florida
customers were established in 2022 by Final Order following a disputed fact hearing.4
Testimony filed by FPL in 2021 in its rate case indicated that FPL’s Northwest Florida legacy5
storm restoration costs and surcharges associated with Hurricanes Michael and Sally were to
remain 	applicable 	to 	only 	those 	customers. 6 	Our 	final 	orders 	are 	generally 	afforded
administrative finality and are not subject to subsequent modification.7 The issue of maintaining
the current surcharge in place for FPL’s Northwest Florida customers only until full recovery
was not specifically litigated or a material issue in either the prior storm recovery or FPL rate
case docket. We are not persuaded that finality is attached to this issue. Moreover, administrative
finality does not apply where there has been a substantial change in circumstances or a
demonstrated public interest.8 Both are present in this docket and, accordingly, we have the legal
authority to unify the charges.9
Hurricanes Ian and Nicole affected only FPL Peninsular customers, i.e., customers served
by FPL prior to the merger with GPC. The proposal to apply the surcharge for this storm
recovery to all current FPL customers, including FPL’s Northwest Florida customers who were
not impacted, is a substantial change in circumstances from the prior approach of segregating
costs based on impacts. Spreading costs evenly across customers for all storms no matter the
location of impacts is the appropriate reaction to these changed circumstances.10
The alternate storm charge calculations project a 12-month recovery period (April 2023
through March 2024), subject to a final true-up. Under the currently-approved recovery schedule,
recovery of Hurricanes Sally and Zeta costs are projected to be complete in December 2024. In
4Order No. PSC-2022-0406-FOF-EI, issued on November 21, 2022, in Docket Nos. 20200241-EI, 20210178-EI, and
20210179-EI, in In re: Petition for limited proceeding for recovery of incremental storm restoration costs related to
Hurricane Sally, In re: Petition for evaluation of Hurricane Isaias and Tropical Storm Eta storm costs, by Florida
Power & Light Company, and In re: Petition for limited proceeding for recovery of incremental storm restoration
costs and associated true-up process related to Hurricane Zeta, by Gulf Power Company.
5FPL and GPC were separate ratemaking entities until the end of 2021.
6Document No. 02776-2021 in Docket No. 20210015-EI, Direct Testimony of Tiffany Cohen, p. 30 lns. 9-15.
7Peoples Gas System, Inc. v. Mason, 187 So. 2d 335, 339 (Fla. 1966) (“orders of administrative agencies must
eventually pass out of the agency’s control and become final and no longer subject to modification”).
8Delray Medical Center, Inc. v Agency for Health Care Admin., 5 So. 3d 26, 29 (Fla. 4th DCA 2009).
9In response to a data request from staff, FPL concurred that there is no legal prohibition on our imposing a uniform
storm surcharge on all current FPL customers. Document No. 01037-2023.
10See Mason, 187 So. 2d at 339 (“actions of administrative agencies are usually concerned with deciding issues
according to a public interest that often changes with shifting circumstances and passage of time”).

ORDER NO. PSC-2023-0110-PCO-EI
DOCKET NO. 20230017-EI
PAGE 4
response to staff’s data request, FPL stated that this accelerated recovery of storm costs would
“benefit FPL and its general body of customers by reducing the amount of interest recovered
from customers and regulatory lag, while also mitigating the potential for overlapping storm
recovery charges in the future.”11 As to whether the alternative is preferable, FPL stated in its
response that it “views both as being potentially appropriate options for storm cost recovery.”12
FPL explained that it has allocated the storm cost recovery amount to the rate classes
consistent with the rate design approved in the 2021 Settlement. 13 We have reviewed the storm
cost 	recovery 	allocation 	and 	calculation 	of 	rates, 	for 	FPL’s 	proposal 	and 	the 	alternate
calculations, and find that FPL has calculated rates in accordance with the 2021 Settlement,
using the most recent load research study and projected billing determinants for the recovery
period. The storm cost recovery surcharge shall be included in the non-fuel energy charge on
customer bills, which FPL states is consistent with its standard practice.
For residential customers, the alternate surcharge will be 1.530 cents per kWh, which
would equate to $15.30 on a 1,000 kWh residential bill. Under FPL’s proposed tariff, for
residential customers, the surcharge would be 1.384 cents per kWh, which would equate to
$13.84 on a 1,000 kWh residential bill. Under FPL’s proposal, FPL’s Northwest Florida
customers would pay the proposed $13.84/1,000 kWh while continuing to pay the approved
Hurricanes Sally and Zeta surcharges. FPL’s Northwest Florida customers will have paid for all
the Hurricane Michael costs by March 31, 2023.
Under the alternate tariff, the FPL Peninsular customers would pay a storm recovery
surcharge that is $1.46 ($15.30-$13.84) higher than FPL’s proposal on the 1,000 kWh bill for a
12-month period. However, FPL’s Northwest Florida customers would save monthly between
$11 (Hurricanes Michael and Sally surcharges) to $9.34 (Hurricane Zeta surcharge) on the 1,000
kWh bill for a 21-month period. The savings to FPL Northwest Florida customers, in addition to
the reasons discussed above, outweigh the incremental $1.46/1,000 kWh for the FPL Peninsular
customers, when comparing the two storm recovery options.
For these reasons, we deny FPL’s proposed interim storm restoration recovery charge.
We approve FPL’s alternate storm charge calculation and associated tariff sheet No. 8.030.7 as
shown in Attachment A to this Order, effective with the first billing cycle of April 2023.
Furthermore, effective with the first billing cycle of April 2023, tariff sheet Nos. 8.030.4,
8.030.5, and 8.030.6 shall be cancelled, as shown in Attachment A hereto. The alternate storm
charge 	calculation 	avoids 	significant 	disparities 	in 	surcharges 	among 	customers 	of 	one,
consolidated utility, reduces regulatory lag and interest payments, and mitigates the potential for
overlapping storm recovery charges in the future.
The approval of an interim storm restoration recovery charge is preliminary in nature and
is subject to refund pending further review once the total actual storm restoration costs are
11Id.
12Id.
13 Order No. PSC-2021-0446-S-EI, issued December 2, 2021, in Docket No. 20210015-EI, In re: Petition for rate
increase by Florida Power & Light Company.

ORDER NO. PSC-2023-0110-PCO-EI
DOCKET NO. 20230017-EI
PAGE 5
known. After the actual costs are reviewed for prudence and reasonableness, and are compared to
the 	actual 	amount 	recovered 	through 	the 	interim 	storm 	restoration 	recovery 	charge, 	a
determination will be made whether any over/under recovery has occurred. The disposition of
any over/under recovery, and associated interest, will be considered by us at a later date.
Based on a review of the information provided by FPL in its petition, we authorize the
Company to implement an interim storm restoration recovery charge subject to refund. Once the
total actual storm costs are known, FPL shall file documentation of the storm costs for our
review and true-up of any excess or shortfall.
FPL has requested that all funds collected subject to refund be secured by a corporate
undertaking. The criteria for a corporate undertaking include sufficient liquidity, ownership
equity, profitability, and interest coverage to guarantee any potential refund. FPL requested a 12-
month collection period from April 2023 through March 2024 for Interim Storm Cost Recovery
Charges of $1.5 billion related to Hurricanes Michael, Sally, Zeta, Ian and Nicole. We reviewed
FPL’s three most recent annual reports filed with us (2021, 2020, and 2019) to determine if the
Company can support a corporate undertaking to guarantee the funds collected for recovery of
incremental storm restoration costs related to the weather events. FPL’s financial information
demonstrates the Company has acceptable levels of liquidity, ownership equity, profitability, and
interest coverage to support a potential refund of $1.5 billion. Moreover, it is improbable FPL
will be required to refund the entire requested amount.
We find that FPL has adequate resources to support a corporate undertaking in the
amount requested. Based on our analysis, a corporate undertaking of $1.5 billion is acceptable.
This brief financial analysis is only appropriate for deciding if the Company can support a
corporate undertaking in the amount proposed and was not considered in our evaluation of other
issues in this proceeding.
Based on the foregoing, it is
ORDERED by the Florida Public Service Commission that Florida Power & Light
Company’s petition for recovery of incremental storm restoration costs related to Hurricanes Ian
and Nicole is approved. It is further
ORDERED that FPL’s proposed interim storm restoration recovery charge for Hurricanes
Ian and Nicole is denied. It is further
ORDERED that FPL’s proposed consolidated interim storm restoration charge for
Hurricanes Ian, Nicole, Michael, Sally, and Zeta as shown on tariff sheet no. 8.030.7, appended
to this Order as Attachment A, is approved, subject to refund, effective with the first billing cycle
of April 2023. It is further
ORDERED that FPL’s tariff sheet Nos. 8.030.4, 8.030.5, and 8.030.6 shall be cancelled
effective with the first billing cycle of April 2023. It is further

ORDER NO. PSC-2023-0110-PCO-EI
DOCKET NO. 20230017-EI
PAGE6
ORDERED that once the total actual consolidated storm costs are known, the Company
shall file documentation of the storm costs for our review and true up of any excess or shortfall.
It is further
ORDERED that the appropriate security to guarantee the funds collected subject to
refund is a corporate undertaking. It is further
ORDERED that this docket shall remain open pending final reconciliation of actual
recoverable storm costs with the amount collected pursuant to the consolidated interim storm
restoration recovery charge, and the calculation of a refund or additional charge if warranted.
SPS
By ORDER of the Florida Public Service Commission this 23rd day of March, 2023.
)),
Commissio
Florida Public Service Commission
2540 Shumard Oak Boulevard
Tallahassee, Florida 32399
(850) 413-6770
www.floridapsc.com
Copies furnished: 	A copy of this document is
provided to the parties of record at the time of
issuance and, if applicable, interested persons.
NOTICE OF FURTHER PROCEEDINGS OR JUDICIAL REVIEW
The Florida Public Service Commission is required by Section 120.569(1), Florida
Statutes, to notify parties of any administrative hearing or judicial review of Commission orders
that is available under Sections 120.57 or 120.68, Florida Statutes, as well as the procedures and
time limits that apply. 	This notice should not be construed to mean all requests for an
administrative hearing or judicial review will be granted or result in the relief sought.
Mediation may be available on a case-by-case basis. 	If mediation is conducted, it does
not affect a substantially interested person's right to a hearing.

ORDER NO. PSC-2023-0110-PCO-EI
DOCKET NO. 20230017-EI
PAGE 7
Any 	party 	adversely 	affected 	by 	this 	order, 	which 	is 	preliminary, 	procedural 	or
intermediate in nature, may request: (1) reconsideration within 10 days pursuant to Rule 25-
22.0376, Florida Administrative Code; or (2) judicial review by the Florida Supreme Court, in
the case of an electric, gas or telephone utility, or the First District Court of Appeal, in the case
of a water or wastewater utility. 	A motion for reconsideration shall be filed with the Office of
Commission Clerk, in the form prescribed by Rule 25-22.0376, Florida Administrative Code.
Judicial review of a preliminary, procedural or intermediate ruling or order is available if review
of the final action will not provide an adequate remedy. Such review may be requested from the
appropriate court, as described above, pursuant to Rule 9.100, Florida Rules of Appellate
Procedure.

ORDER NO. PSC-2023-0110-PCO-EI DOCKET NO. 20230017-EI
Attachment A
PAGE 8
FLORIDA POWER & LIGHT COMPANY
Canceled Original Sheet No. 8.030.4
(Continued from Sheet No. 8.030.3)
HURRICANE MICHAEL STORM RESTORATION RECOVERY
APPLICATION:
The Storm Restoration Recovery Surcharge is designed to recover incremental storm related costs incurred by the Company related to Hurricane Michael. It is applicable to all accounts within the service area previously served by Gulf Power. The facter is applicable to the Energy Charge under FPL's various rate schedules.
Rate Schedule
e/kWh
ALL KWH RS 1, RTR 1
0.800
GS 1, GST 1
0.881
GSD 1, GSDT 1, GSD 1EV, HLFT 1, SDTR 1
0.443
GSLD 1, GSLDT 1, GSLD 1EV, CS 1, CST 1, HLFT 2, SDTR 2
0.347
GSLD 2, GSLDT 2, CS 2, CST- 2, HLFT 3, SDTR 3
0.234
GSLD 3, GSLDT 3, CS-3, CST 3
0.234
OS 2
1.178
CILC H(C)
0.347
CILCH(D)
0.347
CILC 1(T)
0.234
SL 1, SL 1M, PL 1, LT 1
1.178
1.178
1.178
SL 2, SL 2M, GSCU 1
1.178
SST H(T), ISST H(T)
0.234
SST 1(DI), SST 1(D2) SST 1(D3), ISST 1(D)}
0.234
RESERVED FOR FUTURE USE
(Continued on Sheet No. 8.030.5)
Issued by: Tiffany Cohen, Senior Director, Regulatory Rates, Cost of Service and Systems Executive Director, Rate Development & Strategy Effective: January 1, 2022

ORDER NO. PSC-2023-0110-PCO-EI DOCKET NO. 20230017-EI PAGE 9
Attachment A
Canceled First Revised Sheet No. 8.030.5 Canceled Original Sheet No. 8.030.5
FLORIDA POWER & LIGHT COMPANY
{Continued from Sheet No. 8.030.4)
HURRICANE SALLY STORM RESTORATION RECOVERY
APPLI CATION:
The Storm Restoration Recovery Surcharge is designed to recoverineremental storm-related costs ineurred by the Company related to Hurricane Sally. It is applicable to all accounts within the service area previously served by Gulf Power. The factor isapplicable to the Energy Charge under FPL's various rate schedules.
Rate Schedule
s/kWh
ALLKWH RS 1, RTR 1
0.300
GS 1,GST 1
0.325
GSD 1, GSDT 1, GSD 1EV, HLFT 1, SDTR 1
0.168
GSLD 1, GSLDT 1, GSLD 1EV, CS-1, CST-1, HLFT 2, SDTR-2
0.131
GSLD 2, GSLDT 2, CS 2, CST 2, HLFT 3, SDTR 3
0.087
GSLD 3, GSLDT 3, CS 3,CST 3
0.087
OS 2
0.228
CILC 1(G)
0.131
CILC 1(D)
0.131
CILC 1(T)
0.087
SL 1, SL 1M, PL 1, LT 1
0.228
OL 1
0.228
OSIAI
0.228
SL 2, SL 2M, GSCU 1
0.228
SST H(T), ISST H(T)
0.087
SST 1(D1), SST 1(D2) SST 1(D3), ISST 1(D)
0.087
RESERVED FOR FUTURE USE
(Continued on Sheet No. 8.031)
Issued by: Tiffany Cohen, Senior Director, Regulatory Rates, Cost of Service and Systems Executive Director, Rate Development & Strategy

ORDER NO. PSC-2023-0110-PCO-EI DOCKET NO. 20230017-EI
Attachment A
PAGE 10
FLORIDA POWER & LIGHT COMPANY
Original Sheet No. 8.03-0.6
{Continued from Sheet No. 8.030.5)
HURRICANE ZETA STORM RESTORATION RECOVERY
APPLICATION:
The Storm Restoration Recovery Surcharge is designed to recoverincremental storm related costs incurred by the Company related to Hurricane Zeta. It is applicable to allaccounts within the service area previously served by Gulf Power. The factor is applicable to the Energy Charge under FPL's various rate schedules.
Rate Schedule
e/kwh
ALLKWH RS 1, RTR 1
0.934
GS 1,GST 1
0.960
GSD 1, GSDT 1, GSD 1EV, HLFT 1, SDTR 1
0.476
GSLD 1, GSLDT 1, GSLD 1EV, CS 1, CST 1, HLFT 2, SDTR 2
0.342
GSLD 2, GSLDT 2, CS 2, CST 2, HLFT 3, SDTR 3
0.208
GSLD 3, GSLDT 3, CS 3, CST 3
0.208
OS 2
0.523
CILC 1(G)
0.342
CILG KD)
0.342
CILC K(T)
0.208
SL 1, SL 1M,PL 1,LT 1
0.523
0.523
0.523
SL 2, SL 2M, GSCU 1
0.523
SST 1(T), ISST 1(T)
0.208
SST HD1), SST HD2) SST 1(D3), ISST H(D)
0.208
(Continued on Sheet No. 8.031)
Issued by: Tiffany Cohen, Senior Director, Regulatory Rates, Cost of Service and Systems Effective:

ORDER NO. PSC-2023-0110-PCO-EI
DOCKET NO. 20230017-EI

PAGE 11

| FLORIDA POWER & LIGHT COMPANY
a

Attachment A

Original Sheet No. 8.030.7

(Continued from Sheet No. 8.030.3)

2022 CONSOLIDATED INTERIM STORM RESTORATION RECOVERY

| APPLICATION:

Rate Schedule é/kKWh
ALL KWH - RS-1, RTR-1 1.530
GS-1, GST-1 L414
GSD-1, GSD-IEV, GSDT-1 0675
HLFT-1, SDTR-1 =—
GSLD-1, GSLD-IEV, GSLDT-1 0661
CS-1L, CST-1, HLFT-?, SDTR-2 —
GSLD-2, GSLDT-2, CS-2, CST-2 0.531
HLET-3. SDTR-3 Se
GSLD-3, GSLDT-3

CS-3, CST-3 0.030
OL-1 4624
OS-2 2.409
SL-1L, PL-1, LT-1, O$ I/II 1526
SL-1M 0.955
SL-2 OFM
SL-2M 1.808
SST-1 ISST-1 0.058
SST-1(D1), SST-1(D2), SST-1(D3)} 1.892
ISST-1(D)

CILC-1(D) 0.481
CILC-1(G) 0.583
CILC-L(T} 0.028
MET 0.660
GSCU-1 2.591

(Continued on Sheet No. 8.031)
ES

The Consolidated Interim Storm Restoration Recovery Surcharge is designed to recover incremental storm-related costs
incurred by the Company related to Hurricanes Michael, Sally, Zeta, lan, and Nicole. The factor is applicable to the
Energy Charge under FPL’s various rate schedules.

Issued by: Tiffany Cohen, Executive Director, Rate Development & Strategy

Effective: