OUC rate revamp: Angry predictions of higher electric bills in Orlando, which officials dispute

Orlando’s power provider plans to vote Tuesday on revamping its billing structure, changing incentives for when and how customers consume power, which has fueled a combative controversy over what’s best for local solar energy and electricity users.

The publicly owned Orlando Utilities Commission contends it needs to restructure rates to be modern, nimble and fair as the utility – in advancing the fight against climate change – hurtles toward phasing out coal and natural gas in favor of solar and other green energy. Bills on average for more than 250,000 customers would change little, the utility asserts.

But some environmentalists, civic activists and proponents of residential rooftop solar panels are lashing out at OUC’s initiative as less about climate action and more about jacking up power bills, wrecking a nascent solar industry and funding “lavish expenses.”

Both sides accuse each other of making outdated assumptions, ignoring inconvenient realities and dishing out falsehoods.

“It is my deeply held opinion that they are stretching the truth and in some cases blatantly lying,” said Heaven Campbell, Florida program director for Solar United Neighbors, a nonprofit that helps communities set up solar cooperatives.

Also deeply vested in the outcome is Orlando city government, which siphons away nearly $100 million of OUC’s annual income to pay for essential municipal services, but which also has been a strong advocate for the utility’s transformation to clean energy.

Orlando Mayor Buddy Dyer has a permanent seat and by far the most potent voice on OUC’s five-member board, which must approve the proposed rate overhaul. Friday afternoon, the mayor responded in writing to Orlando Sentinel questions on where he stands in the matter. Dyer had opposed an earlier version of the plan, forcing OUC back to the drawing board, and he appears to have been mollified.

“Mayor Dyer supports OUC’s plan, noting their responsiveness to extensive stakeholder input and their efforts to address his concerns through thoughtful modifications,” city spokesperson Ashley Papagni said in a statement.

The most provocative issue in OUC’s intended rate revamp is a proposed reduction in the utility’s longstanding incentive for customers to install solar panels on rooftops.

Today, the utility pays a retail rate – which is the same rate it charges when selling power to customers – for the extra electricity coming from household solar systems.

With its intended rate revamping, OUC after a 20-year grandfathering for existing rooftop solar would sharply reduce the compensation to a wholesale rate, equal to how much it costs OUC to generate electricity.

The utility’s reasoning is that household solar systems have become more affordable, that OUC’s large solar systems generate electricity at a far lower cost than rooftop systems and that paying a retail rate for surplus solar power is not fair to the vast majority of OUC customers who do not have solar panels.

That single proposal has been met with strident outrage from those involved with solar cooperatives, the solar industry and a city council member, Patty Sheehan, who has solar panels and considers herself to be one of city hall’s experts.

“They do not appreciate the investment that individuals like myself have put into rooftop solar and how it decreases their need to produce energy,” Sheehan said of OUC, responding to the Sentinel. “I believe they have become an unreliable and unsustainable municipal utility that is punishing solar customers for their investment.”

Opponents contend the switch to a wholesale rate will dissuade more residents from installing panels on their rooftops and hamper the city’s solar industry, undermining support needed for OUC’s quest to be done with fossil fuels by 2050.

The Florida Solar Energy Industries Association, whose members include companies related to sales, installation and upkeep of solar panels on residential rooftops, has been the hardest hitting of opponents to OUC’s rate overhaul.

Its website, www.dontdoublemyelectric.com, warns that Orlando will face dire employment, economic and consumer consequences if its utility approves a new rate structure.

The website claims that 10,000 local jobs would be jeopardized and that rate changes would underwrite OUC’s lavish expenses, a claim made beneath an illustration of dollar signs and a fresh martini.

The association provided little substantiating detail when asked about those assertions.

Asked to explain the association’s claim on its website that rates would double for all OUC customers, a group leader, Justin Hoysradt, said: “We do not see a path where they don’t.”

Two other OUC rate proposals – not directly about solar energy but still enveloped in the solar dispute’s rancor – address the amount, timing and other customer behavior in consuming electricity.

A proposed change that OUC calls Demand Level Pricing would slightly reduce the per-watt charge for electricity but add a monthly fee according to usage of $5, $10 or $15 – so that the more a customer uses, and puts a strain on OUC’s electrical system, the higher the monthly fee.

The other rate change, called Save and Shift, would result in the per-watt charge being higher during times of peak demand, including, for instance, afternoon hours during the summer. Off-peak times would see a reduced per-watt charge.

For several reasons, peak electricity is more expensive for OUC to generate than off-peak electricity.

“Our goal is a modern pricing structure that meets today’s energy needs while building a stronger, more resilient energy system,” said Mindy Brenay, OUC’s chief financial officer, in a guest column running Friday in the Orlando Sentinel.

Yet opponents say Orlando is poorly prepared for those changes, which would come too fast and too harsh especially for low-income customers.

The Rev. Kathy Schmitz, president of the League of Women Voters of Orange County, said OUC has gone astray recently in its quest for renewable energy and would give the utility a F grade if it adopted its rate changes.

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