The Florida Municipal Power Agency unanimously approved Vero Beach’s exit from the statewide electric co-op on March 21. Now the city needs the Florida Public Service Commission to approve the sale of Vero’s electric utility to Florida Power & Light, so the deal can close as planned on Oct. 1.
The PSC has not yet scheduled a hearing to approve the sale or redraw FPL’s territory to encompass Vero’s 34,000 customers. Vero and FPL officials had been hopeful the matter might get a final hearing before the PSC in late April, but that probably will not happen until May.
The PSC is tasked with making sure the $185 million purchase price, plus all ancillary agreements and considerations, are fair and equitable to FPL’s 4.9 million customers across Florida.
To that end, it has conducted an audit of the proposed transaction, and now it appears PSC attorneys are digging into the side deal FPL made with the Orlando Utilities Commission, agreeing to pay a reported $25 million extra to OUC to avoid a lawsuit over the size of Vero’s exit penalty from a power-buying agreement.
Once that FPL-OUC side deal was inked, FMPA leadership crisscrossed the state to obtain approvals from governing boards of 19 member cities who are partners with Vero in three power generation projects. Then the full board and executive committee of the FMPA voted on four resolutions – three of which relieved Vero of its virtual ownership rights and responsibilities in the Stanton 1, and Stanton 2 power plants and the St. Lucie nuclear projects, and one that provided for Vero’s general exit from FMPA membership, contingent upon the sale.
Those measures were the obstacles that for many years prevented Vero from getting out of the electric utility business. The final solution was costly – $108 million of the sale proceeds will go to make the remaining FMPA members whole – but necessary to move the sale off center.
Utility activist Glenn Heran said after the FMPA vote, “It was a hurdle most people thought it was impossible to get over and we managed to do that. This is why people don’t take on mammoth issues like this – because it took nearly a decade of pounding away at this deal from every financial, legal, political and regulatory angle to get it to this juncture.”
Now, as all eyes are on the PSC process, a new player has come into the picture in the form of the Florida Office of Public Counsel (OPC), which on March 13 filed paperwork to intervene in FPL’s petition for the PSC to approve the sale.
The OPC is the public’s legal representation, and City Manager Jim O’Connor said he fully expected them to jump in as official intervenors to examine the deal at some point. “To my knowledge, the Office of Public Counsel intervenes in about 90 percent of the matters before the PSC that involve FPL,” O’Connor said.
FPL Spokesperson Sarah Gatewood echoed O’Connor’s assessment that the OPC intervention coming was no late-in-the-game surprise. “It’s not unusual for the OPC to intervene at any stage of the process, and at this time we don’t expect their intervention to delay the Oct. 1 closing,” Gatewood said.
The City Council will have a complete status update on the sale, with representatives from FPL and the FMPA present, at 9:30 a.m. on April 17.