Court Opinion

ID: 4883347
Source: CourtListenerOpinion
Date Created: 2021-09-02 23:17:31.541044+00
Date Added: 2024-06-11T08:04:04.328395
License: Public Domain

Commissioner BEVIS,
dissenting in part.
The belated reasoning expressed in the majority opinion in support of the inverted rate structure is like trying to grasp for a cushion large enough to support your vehicle’s fall after you have driven a cement truck off a cliff. Some of the crowd may be excited about seeing whether you can make it fly, but the law of gravity, the laws of economics, arid the laws of men are not so accommodating to cement trucks or to the inverted rates implemented in this case.
The inverted rate structure should not have been implemented herein. It was never made the subject of any public hearing held on the rate application filed by Florida Power & Light Company. It was “announced” at the agenda conference at which this case was decided.
The Florida Power & Light Company case produced 5,333 pages of testimony, 130 exhibits containing over 1,800 additional pages, 24 days of public hearings, and 3 agenda conference days during which the commission reviewed the case and rendered its decision. Therefore, a single sentence on page 4915 of the transcript which the majority claims “embraced and supported” the “inverted” concept does not appear to constitute competent, substantial evidence upon which this radical change in rate structure can be predicated. Nor do I consider the notice requirements of due process to have been approached, much le$s to have been met in this case.
*155Such a public furor developed after PSC adoption of inverted rates for the FP&L service area that Gulf Power Company and Tampa Electric Company demanded that evidence be taken on the inverted rate issue in their subsequent rate hearings. Based on the evidence in those two records, this commission did not adopt inverted rates in either of those two cases.
A substantial part of the reasoning for my dissent here is set forth in my dissent in the original order issued by the commission on this subject. (Docket No. 760727-TP, Order No. 7483) General procedural aspects were also discussed in my special concurring opinion in Docket No. 760727-TP, Order No. 7871. I will not duplicate those comments here, but they are very informative about many aspects of this case.
The majority here seems to miss the point on how fundamental fairness should apply to the ratepayers. A substantial portion of their logic depends on the suggestion that if more than a majority of ratepayers would pay lower rates under the inverted rate structure than under the traditional declining block rate structure, then the severe burdens placed on a (presumed) minority of the ratepayers are irrelevant, no matter how severe. This is politics at its worst.
This discrimination has no justification and no basis in the record of this case. The failure of the majority to allow the full and careful study of the inverted rate proposal, the specific rate levels that would be implemented, and the consequences that would result therefrom warrants the reversal of the decision rendered in Order No. 7843. In the agenda conference upon which the present order is based, the majority suggested that up to 84% of the customers of the FP&L service area may benefit from the inverted rate structure. I am skeptical as to the percentages of FP&L’s customers who may be “helped” by the inverted rate structure during various times of the year. Merely taking a rate structure which is radically different from a prior rate structure and applying those new rates to prior consumption data generated under the old rates is not a very accurate or professional method of projecting future benefits.
In addition, there is no justification for an “experiment” to see what the effects of the ill-conceived, un-studied residential rates implemented in this case will do to the customers. We as commissioners have a duty to be more careful than that.
Since the issue of an inverted rate structure was not brought up until the last day of the agenda conference on this rate case, it was difficult to devote enough thought to this issue to comprehend all of its ramifications at that time. However, after having an opportunity to consider the nature of the inverted rate, there is reason*156able doubt as to whether this commission has the authority to implement an inverted rate structure such as the one implemented in this case. The per-kilowatt hour charges in the two blocks which comprise the inverted rate are totally devoid of any relation to cost.
The Florida Public Service Commission was created by the Florida legislature. It has been given vast authority over the regulation of private electric (and other) utilities in Florida. (See especially Chapters 350 and 366, Florida Statutes). However, this commission has only the authority which is specifically granted to it in the statutes or which reasonably may be inferred from the specific wording of the statutes. The statutes do not authorize the commission, either explicitly or implicitly, to engage in income redistribution or social welfare programs.
Therefore, when the statutes were passed by the legislature and, indeed, until the commission ordered its “inverted rates” in Order No. 7843 in this case, rates were related to the costs the companies incurred in serving their customers. I can find no place in any statute where the Florida Public Service Commission has been given authority to redistribute income or to engage in social welfare activities.
While the Public Service Commission has the duty to regulate utilities as an exercise of the police power of the state for the “welfare” — or well-being — of the state’s citizens, it does not appear to have the authority to engage in the type of “social welfare” which involves income redistribution, subsidization, or the taking of income or accumulated wealth from one person or group and giving it directly or indirectly to another person or group. There are two separate and distinct uses of the word “welfare.”
By contrast, the Florida legislature has created a Florida Department of Health and Rehabilitative Services to deal with “social welfare” and many other issues in Florida. It is responsible for implementing the Florida statutes which provide a comprehensive social welfare program throughout the state.
It might be suggested that the so-called “cost related” declining block rates (or any form of rates for that matter) cannot reflect the exact, to-the-penny cost of providing the utility service and thus result in some slight income redistribution. This statement obviously is correct. However, this reflects the minor shortcomings of the administrative and regulatory tools with which we must work, and the deviations away from “cost” arc minimal. It also reflects the practice of many state utility commissions, such as this one, to make certain minor adjustments to cost-based rates for policy reasons. However, the inverted rate structuré (which was voted *157on as a “lifeline” rate but implemented as a “conservation” rate) has as its specific purpose the provision of service to residential classes which are in no way related to costs. In fact, the per-kilowatt hour charges in both blocks of the inverted rate structure totally ignore any recognized principle of rate design and are based instead on social considerations.
In Gulf Oil Co. v. Bevis, 322 So.2d 30, at 34 (Fla. 1975), the dissent observed that —
“The commission’s fear for [the small, independent marketers’] ability to survive and compete in today’s energy-short economy is commendable. The commission may not, however, depart from the essential requirements of law in a contested administrative proceeding in order to decide interesting social questions. The commission, like all other agencies of government, is obliged to protect the public interest by using lawful procedures.”
By way of comparison of the ability of various state agencies to perform social functions, the Florida Public Service Commission has 344 employees to perform all of its regulatory responsibilities. The Florida Department of Health and Rehabilitative Services has over thirty thousand employees, many of whom are engaged directly or indirectly in performing analysis of social needs and in performing welfare services of various kinds.
In closing, I can only conclude that the moral of this Florida Power & Light Company case is that if you render decisions like those which the Public Service Commission must render, you must comply with the law and the constitution — unless you also drive a cement truck. In that case, let the citizens beware.