TECO seeks lower fuel costs
By NEIL JOHNSON, email@example.com
Tampa Electric customers could see the fuel portion of their bills drop next year, benefitting from a decline in what the utility expects to pay for coal and natural gas.
TECO estimates the fuel portion of residential electric bills will fall by $6.23 for a 1,000 kilowatt-hour monthly bill if the Florida Public Service Commission approves the decrease.
That doesn’t mean customers will begin pocketing the entire amount starting in January.
In March, the PSC approved an increase in TECO’s base rate. Going into effect in January, the increase will devour most of the savings from the lower fuel costs.
Counting the rate increase, customers will see a saving of $1.46 on a monthly residential bill for 1,000 kwh, dropping the bill to $113.21.
Commercial and industrial customers are expected to see a 3 percent reduction in electric rates, the company said.
The lower fuel charge is on top of a $16.17 reduction on customers’ bills for 1,000 kwh that took effect in May. That reduction came from lower fuel costs in 2008 and this year, said company spokesman Rick Morera.
The lower fuel charges stem from a combination of lower fuel costs and a reduced demand for electricity.
The company historically has seen an annual increase of 2.5 percent in its customer base, but it has been flat in 2008 and this year, Morera said.
The company filed its annual fuel cost report this month, including fuel cost projections for the first six months of 2009 and projections for the rest of the year and 2010.
The decreases come from reduced costs for purchased power as well as fuel for TECO’s generators.
Tampa Electric Co. primarily uses coal and natural gas, with fuel costs accounting for about 40 percent of a customer’s electric bill.