Florida Electric Utility Industry
The electric utility industry is comprised of municipal utilities, cooperatives and investor-owned utilities. Municipal utilities are governed by an elected city commission, or an appointed or elected utility board. Municipal utilities are not-for-profit. Capital is raised through operating revenues or sale of tax-exempt bonds.
There are 33 municipal electric utilities in the state, and they serve approximately three million customers, or 14 percent of Florida’s population. In the United States, there are more than 2,000 municipal utilities, serving 14.7 percent of the nation’s electrical needs, or one in seven Americans.
Florida’s Electric Utilities
|Average Number of Customers for Investor-Owned Utilities By Class of Service: 2019
|Duke Energy Florida||1,691,570||180,351||2,074||27,136||
|Florida Power & Light Company||4,391,832||553,562||11,601||4,318||
|Florida Public Utilities Company||23,921||4,216||2||2,870||31,009|
|Gulf Power Company||405,462||56,678||251||592||462,983|
|Tampa Electric Company||670,517||74,895||1,588||9,254||756,254|
Regulation of Florida’s public power utilities is largely through local boards or commissions. Power plant siting is regulated by the Florida Public Service Commission. Environmental compliance is the responsibility of the Florida Department of Environmental Protection. The Governor and Cabinet make final power plant siting recommendations acting as the state power plant siting board. Municipal utilities also occasionally address wholesale power and transmission issues at the Federal Energy Regulatory Commission.
Electric cooperatives are governed by an elected board of directors. Those cooperative customers whose name appears on a bill are eligible to vote for these directors. Cooperative boards set their own rates.
Privately owned utilities, also known as investor-owned utilities, or IOUs, are governed by a board of directors elected by stockholders. IOUs are a state-regulated monopoly. They exist to make a profit for their stockholders, while serving the public. Capital is raised through stock sales, taxable bonds and through operating revenues. Five IOUs operate in Florida. They are regulated by the Florida Public Service Commission (PSC).
A majority of U.S. consumers believe municipal utilities are more concerned about the environment, offer lower rates, allow more control over utility operations, and have better service than private power companies (American Public Power Association). Americans also strongly favor a competitive, diverse electric utility industry. Municipal utilities provide this competition and diversity. Public power utilities are efficient. The Department of Energy annually reports that municipal electric systems have significantly lower management and operating costs than do private companies.
Serving Local Needs
Public power utilities offer energy services tailored to their local needs. These services range from construction and maintenance of municipal water pumping, street lighting and low-income assistance programs to a wide range of energy efficiency and conservation projects, such as: lighting retrofits, loans, air conditioning tune-ups, load control, tree planting, energy audits, public education, distribution and/or installation of water heater blankets, and power factor improvement activities.
Municipal utilities are governed either by a local city commission or by an elected or appointed utility authority. Municipal utilities are subject to all the state’s laws regarding public bodies, including open meetings law, open records laws, public bidding laws. No other utility invites as much public input or operates in such an open, democratic manner. Open, accessible, governance is one reason municipals are also known as “public power” utilities.The following utilities are governed as a utility authority by an appointed board:
- KUA – Kissimmee Utility Authority
- New Smyrna Beach Utilities Commission
- OUC – Orlando Utilities Commission
- Keys Energy
When there is a problem, response time from utility personnel located in the city is quicker than calling a utility with personnel spread over a wide distance. On average, Florida municipal utilities’ average outage is less than one hour. For the two largest private utilities in Florida, Florida Power and Light and Florida Power Corporation, the average customer outage is more than two hours.
Financial Contributions to Local Government
In addition to providing reliable, low-cost power, municipal electric utilities also return money to the city general fund. This helps a city keep its property taxes low. In many cities, municipal utilities contribute financially to local development efforts, provide free or discounted service to the city, and contribute time, equipment, and materials to city projects.