Florida PSC approves Gulf Power cost recovery request stemming from Hurricane Sally

The Florida Public Service Commission (PSC) approved Tuesday a petition filed by Gulf Power that relates to the impacts caused by Hurricane Sally, which hit Florida in September 2020.

The PSC approved Gulf Power’s request to reduce its 2021 Environmental Cost Recovery Clause (ECRC) charges for the early retirement of Plant Crist Units 4-7, which was due to the damage from Hurricane Sally. Due to the early retirement of these coal generation assets, the result was an unrecovered $67.6 million in base rate capital investment and $394.5 million in ECRC capital investments. This translates to a $3.71 monthly reduction on a 1,000 kWh residential bill through December 2021.

“Instead of retiring the Crist Units at the end of this year as planned, Gulf decided to accelerate the plants’ retirement to October 2020 following damage from Hurricane Sally,” PSC Chairman Gary Clark said. “As a result, customers will benefit from the reduced ECRC charge that more than offsets Gulf’s Hurricane Sally interim restoration charge.”

Also, the PSC approved Gulf’s petition for an interim charge to recover costs related to Hurricane Sally, which made landfall on Sept. 16, 2020, dumping more than 2 feet of rain in areas between Mobile, Ala., and the Florida panhandle. Gulf incurred $206 million in restoration costs related to Hurricane Sally.

“Even though Hurricane Sally did not make landfall in Florida, the storm impacted Gulf’s service area, causing flooding, power outages, and infrastructure damage,” Clark said. “With today’s approval, Gulf will be able to replenish its storm reserve fund to help with future restoration costs.”

Starting in March 2021, the interim hurricane restoration monthly charge for Gulf residential customers is $3.00 per 1,000 kWh. Combined with the $3.71 ECRC reduction, Gulf residential customers will see a net monthly bill reduction of $0.71 on a 1,000 kWh bill.

Gulf Power serves approximately 463,000 customers in Northwest Florida.