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Gulf Power Seeks Rate Increase For Largest-Ever Construction Program
July 13, 2013
Gulf Power Company is asking the Florida Public Service Commission to approve a two-step price increase to help pay for the largest power grid construction program in the history of the company.
Over the next three years, the company is building and replacing power lines and infrastructure — some more than 70 years old — to keep electricity flowing to its 430,000 customers. In addition, new lines and equipment are needed to comply with new mandatory federal environmental regulations.
The first increase would not take effect until April 2014, and it would increase the total bill for a residential customer buying 1,000-kilowatt hours by $8.94 per month or 7.5 percent — from the current price of $118.88 to $127.82.
The second step of the increase — related to the new environmental requirements — would not occur until 2015 and would raise the monthly bill an additional $1.99.
“This is a challenging time for utilities as we continue to provide reliable service to our customers and keep costs down,” said Stan Connally, Gulf Power President & CEO. “There are no easy answers, but we’ve worked hard to control costs and our residential rates are currently lower than they were in 2009.”
Connally cited aged, obsolete equipment and facilities that are at or beyond life cycle that must be upgraded and replaced.
“For example, one section of our transmission lines — 70 miles of it — is more than 70 years old,” Connally said. “We have transformers and other equipment operating well beyond their operational expectancy. We must rebuild parts of our system so we can continue to provide reliable service.”
Part of the new transmission line construction is to help the company comply with new federal environmental regulations that will change the way the company operates its plants and will require plants to be shut down at regular intervals. The new lines and equipment will be used to ensure voltage stability and reliable power flow while the plants are offline.
“Our obligation is to have the electricity available when and where our customers demand it,” Connally said. “This investment is necessary to meet our customers’ expectations, as well as the new federal environmental regulations.”
Gulf Power infrastructure improvements include:
Examples of Gulf Power Infrastructure Investment:
- Substations are being added and improved to continue to provide reliable service to our customers. In Pensacola, a substation on Devilliers Street has been rebuilt. On Allison Avenue in Panama City, a new substation has been built.
- Seventy miles of a 70-year-old transmission line is being rebuilt from Panama City to Holmes County.
- An existing transmission line between Highland City and Holmes Creek substations in the Panama City area is being upgraded to maintain reliability for our customers.
- A new 38-mile transmission line is being added that begins in the Pensacola area and goes through North Escambia o the Florida-Alabama state line. This project is necessary for mandatory federal environmental compliance. The new transmission line is being built alongside an additional line and will require no additional right of way.
Pictured top: Gulf Power crews making upgrades to a substation on Devilliers Street in Pensacola. Pictured inset: Gulf Power crews making upgrades to a distribution line. Submitted photos for NorthEscambia.com, click to enlarge.
Comments
29 Responses to “Gulf Power Seeks Rate Increase For Largest-Ever Construction Program”
Excellent reader comments about GP & Southern Co. of their policies, practices, wish list, etc……We The Rate Payers want complete transparency, full disclosure and independent oversight…..Time to change the business model.
gulf power needs to open their books to the public if they have nothing to hide. the psc should make them bring their books to the meeting. I am tired of them increasing our rates over and over. an investigation needs to be done right now. so the next big question is what are they doing with all the money? I do plan to question them about the rider fee on my bill. this fee should come from gulf power since the workers have to go out and drive. we should not have to pay this fee at all. I hope this is brought up at the meeting when this is voted upon. we the public need to stand up to this greedy company and battle!!!
I ran a few numbers. If Gulp would have been banking the 4 million a year increase they want today for the last 70 years they would have almost 300 million plus unknown amounts of interest for “MORE PRETEND UPGRADES”…If they had put away 1 million a year for the last 70 years they would still be sitting on a fortune. Instead they set aside NOTHING? Hummmmm makes you wonder…..Natural gas is at an all time low price yet they still push coal in the furnace? Hummmm makes you wonder why? I wonder who they buy the coal from? Hummmmmm
Also folks need to start calling GULP and ask them about the RIDERS (hidden fees) that are “built into the bill”…
Business owners should always establish a reserve fund for future improvements. Gulf Power’s failure to follow a prudent and successful business model that includes adequate reserves from profits to make upgrades and improvements should not be the customer’s burden to bear. Customers do not deserve rate hikes based on normal cradle-to-grave maintenance or upgrades that should be funded directly from overhead, either.
Didn’t we just get charged with a special rider on the bill over the last 9 years or so for all the upgrades from Ivan…How much of the 70 year old equipment made it thru Ivan?
Amen Jane.
First they urge us to be more efficient with our use of electricity, and our cost goes down. Then they raise the cost of electricity so we lose either way. Gas has gone up and now electricity is going up but retired and low income folks can’t make up the cost so they don’t eat right or maybe they take only half their medicine because they can’t afford it anymore. Who needs the government to toss granny off the cliff…leave it to big business.
wow they want more money imagine that………why dont they find the money on the inside like other companies have to when improvements need to be made….im sure they have area they can cut costs in……
last time i checked my pay it was the same as it was 2 years ago…..i have to make my adjustments why cant they???
freeze the pay for awhile their employees make to help fund this request and cut 10% across the board…….im sure that would take care of the money they need to fund it……
after all if the government can do it why cant gulf power……
call and write the PSC and tell them no to the latest hike they want maybe they will listen………..
Utiities are among the riches enterprises in the nation,second only to the oil business..Too much leeway has served to them on a silver platter. If I want to expand my business I go to the bank and borrow the money.What is wrong with that scenario?. Look to our EREC in escambia and santa rosa county buying up the propane business,water systems and even the cable tv business.Would not be surprised to wake one morning and find they are trying a takeover of the southern company..
I understand progress, upkeep, increased population, etc., but with the amount of hurricanes that have occurred in the area over the last 70 years (specifically Erin, Opal, and Ivan), and just the standard severe summer storms. how in the world can there possibly be any 70-year-old equipment still in-use? They replaced gobs of it following each of these storms!(?)
Good luck with the Kerosene lanterns Don with Kerosene over $4.00 a gallon, I’ll stick with Reddi Killowat thank you
“In addition, new lines and equipment are needed to comply with new mandatory federal environmental regulations.”
I can’t wait for them to spin this into a whole charade about this being Obama, Nancy Pelosi, EPA, and the Sierra Club’s fault. What’s sad is people will buy that line while the executives at Gulf Power will keep laughing while you write the checks cursing under your breath about big government being in your backyard. Seriously, you need to wake up and realize you’ve been paying these people too much for too long. It’s time Southern Company starts working for its customers and not the other way around.
Come on David! You know CW meant the circumstances surrounding the plane crash where Jake Horton died were mysterious, not the fact that he actually died in a plane crash!
I was good friends with Jake’s secretary at the time. She thought that something was going on too, must not sure exactly what.
REGARDING:
“But Jake was killed to a strange plane crash. Ain’t that strange?”
Nope.
Being killed when a plane crashes is fairly common.
Any mention of how long we will need to pay for this upgrade? If it takes three years, surely the total cost and time to payout is known.
Gulf Power,
Please build us a nuclear power plant so we won’t emit so many greenhouse gases, polution or depend on foreign sources of fuel. And please pay for it through stock sales.
Merci beaucoup.
David for light in times of darkness
In a press release dated 4/15/2013, Southern Company announced that they raised their dividends for the 12th straight year, to $2.03 per share this year. Coca Cola is paying $.28 per share this year…yes that’s twenty eight cents per share. If you add up Microsoft’s quarterly dividends over the past year, it’s about $.89 per share. I’d say our best strategy is to buy a few hundred shares of Southern Company, and you’d get your money back through next year’s dividend – clearly a stock company looking out for their shareholders and not the rate payers.
Residents are already paying too much for our electricity. They have thought of very clever and convincing “reasons” to raise our rates. Let’s don’t forget that just last week Gov. Scot signed into effect a law denieing a power company the right to increase rates for future facilities. The highest ranking officials of power companies are millionaires.. When we need to improve the efficiency of our business, that money is pulled out of saving account which is there because of smart money managing. Surely the power company was smart enough to hold money aside for equipment improving. After all the executives are making millions a year. How much more burden will The Florida Public Service Commission allow us (the people) to bare? I sure hope they can see thru this charade. But unfortunately big money usually wins
Let us not forget the over 2000 acres in McDavid they bought but evidently can’t use?
GP does a good job at affordable rates but they have spent money extravagantly and get paid to do it. Why, because they are guaranteed percentage of profit over expenses. Most valuable site in Pensacola on Bay Front parkway then building a Taj Mahal. Bought soccer complex for an operations center for 14M from someone who recently paid 3M for it. Ask for pay rates with benefits and you will find that their employees are likely at the top rung of wage earners in our market. I just ask that you as customers and the PSC review the true costs and understand that the guaranteed profit gifted to utilities has been abused in the past.
Nobody likes increased rates, fees or taxes.
Everybody wants their roads maintained, pot holes filled and ditches cleaned out so we won’t have flooding.
Not a big fan of increased costs of any sort but sometimes we do have to pay for what we get.
I have to think of the times our GP crews deploy to other places after natural disasters and of the many power crews that came here to help us after Ivan. Not sure if you remember but we were very thankful when the lights came back on and stayed on.
Infrastructure in this country is cause for great concern, roads, bridges, water and sewer lines are all aged and needing to be replaced.
Heard the other day that by the end of this decade the telephone companies want to discontinue the land line phones in homes and businesses because the cost of copper is so high.
Nope, NOT a fan of higher rates on anything and know about being tight with the budget…..but do like to have my electricity being reliable.
If the infrastructure is not kept operational, we will spend more money in the long run. Gulf Power seems to be planning ahead. Good for them…
I do not own a business, but if I did I don’t think I could get a way with getting other people to cover my expenses replacing things that should have been kept up to date in the last 70 years. They have already tried to get the customers to pay for the nuclear plant that no one asked for to begin with…The people are never asked to voice their opinions and if they do they don’t listen.
Should they give it away?
Look at the electric bill, there s an energy charge, electric charge, there are fees, why don’t they take the new needs out of the fees. SOLAR IS LOOKING REAL GOOD ABOUT NOW!!
As, I am confident, Gulf Power shows a profit – and a HUGE one, at that – EVERY year, maybe it’s time THEY footed the bill rather than the consumers. And at a time when the economy does not appear to be moving in a positive direction, this is not very “user-friendly.” I encourage everyone to write the PSC and protest against the rate hike. Next will come a rate hike to build the nuclear plant in our backyard! We MUST stop them before we end up in the dark!
It must be nice to have a for profit company, and a monopoly also, that charges their customers to upgrade or keep their business going. Lets not forget the “bonuses” the higher ups get for what, screwing the public? Jake Horton was about to expose the southern co. and gulf power in particular, crooked dealings. But Jake was killed to a strange plane crash. Ain,t that strange?
Gulf Power wants a rate increase? That never happens.
Monopoly and extortion walk hand in hand.
So, rather than dividing the cost evenly over two years, about a $5.50 per year, hit the people with an upfront $9.00 and follow with $2.00, is that right? It will be hard enough for some folks to adjust living expenses to accommodate the $5.50 and next to impossible $9 for some. Also, why did it take more than 70 years to figure out some lines need replacing?
It’s so crazy high now,might have to go to kerosene lanterns……