FPL’s renewable energy program, which had 39,000 customers, was closed after a panel learned most of the money went to marketing and administration.
For almost five years, Florida Power & Light trumpeted green energy, saying customers could help the environment by contributing as little as $9.75 a month to buy renewable power.
About 39,000 customers signed up. In April, the U.S. Department of Energy called the program, Sunshine Energy, one of the top 10 residential green power programs in the country.
On Tuesday, angry state regulators killed the program by a unanimous vote after a Public Service Commission staff audit found that about 80 percent of the contributions went for marketing and other administrative expenses.
The staff reported that about $1.8 million of the $9.6 million FPL customers contributed over a four-year span went to purchase renewable energy.
”Oh, I’m not happy with that at all,” said Dianne Martin of South Miami, a contributor to the program. ‘I wonder if I should write them a letter, `Hey, you creeps, why did you do that?’ ”
The utility had acknowledged in regulatory filings that the program could be improved and it volunteered to do so, but it said Sunshine Energy met the requirements laid down by the commission in a formal document called a tariff, which did not specify what percentage of contributions should go directly to renewable energy.
Commissioner Nathan Skop on Tuesday called the program’s performance ”just appalling. . . . It was clearly mismanaged from the inception.” He said the program had “a lot of marketing hype but very little of substance.”
The program started in 2004. Since then, FPL kept about $1 million to administer the program and passed the rest along to a subcontractor, Texas-based Green Mountain Energy, to purchase renewable energy.
For about a year, PSC staffers have tried to get detailed information about how Green Mountain spent the money. The staff estimated about 80 percent went for nonenergy expenses. Its report noted that FPL told the staff 75 percent of the money went for program management, marketing and administration, but the staff said it had a hard time proving where the money actually went.
Commissioner Skop, who once managed nine renewable energy projects for a sister company of FPL, complained on Tuesday that millions of customers’ contributions had fallen “into a black hole where there is no transparency. . . . Clearly this is not right.”
Skop said he thought FPL should be forced to pay back the millions spent on administrative expenses by contributing to a new renewable program.
FPL Vice President Wade Litchfield said the utility and Green Mountain were eager to work with the commission to explain where the money went. He said the Texas company had met the obligations of its contract with FPL.
Robert Thomas, chief legal officer of Green Mountain, said the company would continue to provide information about its expenses to regulators. “We have provided that cooperation in the past, and we will continue to work with the staff. . . . The money was spent for legitimate marketing expenses and other legitimate expenses.”
PUBLIC SEEKS APOLOGY
One customer told the PSC via telephone that she thought that was nonsense. ”I think there should be a public apology,” said a woman the PSC identified as Alexandria Larson. “I think we should hold FPL’s feet to the fire.”
At Tuesday’s meeting, Commissioner Lisa Polak Edgar said FPL had complied with the formal specifications of the tariff that was crafted by the commission, but she noted, ”It’s incredibly important that transparency be there.” Several commissioners wondered whether the tariff itself should have been crafted better.
Commissioner Katrina J. McMurrian said she wasn’t certain what kind of administrative costs were needed for such renewable energy programs. “Perhaps these types of programs take these kind of marketing costs.”
Commissioner Nancy Argenziano said she was concerned about just abandoning 39,000 customers who were dedicated to the environment, and the PSC staff had recommended continuing the program after modifications.
But several commissioners noted that the Legislature recently passed a strong green energy bill encouraging renewable energy, meaning there was less need for a voluntary program.
Following the PSC action, FPL spokesman Mayco Villafaña said, “The Public Service Commission just determined that the Sunshine Energy Program has met its objectives and is no longer needed in light of recent legislation that promotes renewable energy in the state.”
”The PSC said we met our tariff” obligation and operated the program in compliance with its contract, Villafaña said. The utility will be notifying customers that the program is ending, Villafaña added.
Green Mountain Energy released a statement from Senior Vice President Paul Markovich, calling Sunshine Energy “very successful. . . . Sunshine Energy provided tens of thousands of FPL customers an affordable, easy way to voluntarily reduce their carbon footprint.”
By John Dorschner
30 July 2008
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