State Government Florida Public Service Commission Approves New FPL Fracking Guidelines

TALLAHASSEE — On Thursday, the Florida Public Service Commission decided that Florida Power & Light can charge its customers for planned hydraulic fracturing for shale gas, or 'fracking'. In the consent agenda for the Thursday meeting, commissioners unanimously voted for the measure against a staff recommendation for the plan, which is included in new guidelines proposed by FPL on natural gas exploration and drilling.

The decision means that up to $500 million per year can be charged to FPL's 4.7 million customers to finance the drilling. PSC staff said that such a move is unprecedented, as FPL will be the U.S.'s first utility to do so.

In the recommendation to oppose, PSC staff advised, "It would be appropriate to have more experience with this form of investment and the magnitude of costs requested for recovery before the Commission approves guidelines for the proposed investment program with prudence attached."

FPL said that the proposed guidelines "require that gas reserves investments be projected to produce fuel savings for FPL’s customers."

But the Office of Public Counsel (who represent consumers in utility rate cases), which also weighed in, said that FPL’s Proposed Guidelines "violate the guiding principles and policy decisions announced by the Commission."

The OPC also advised that if approved, the guidelines "would open the door for every other investor owned utility to seek a risk-free way to expand rate base without a determination of need and without much scrutiny."

The PSC's five commissioners also decided that the new measures would be reviewed after five years, as long as FPL had begun fracking operations at least three years prior.

Of the changes, FPL spokesman Mark stated that with the recent growth and fast-paced nature of the U.S. natural gas market, "potential partners are unwilling to wait through a lengthy regulatory process before moving forward, which makes the Commission’s approval of guidelines so important."

A fracking site in North Dakota