Sunshine State Lags on Solar Power, Doubles Down on Natural Gas
VERO BEACH, Fla. âThe irony is rich. The Sunshine State taps the sun for less than half a percent of its electricity while making two-thirds with natural gas â a fuel that Florida must pipe in from other states.Some see it as risky gambit. A coastal state already suffering punishing effects of global warming shouldnât keep building power plants that pump even more greenhouse gases into the atmosphere, the Sierra Club warned. Natural gas prices are low now but will inevitably wallop customers down the road, the Florida Industrial Power Users Group predicted. As far back as a dozen years ago, when gas supplied less than 40%of the stateâs electricity, then-Gov. Jeb Bush said utilities needed to stop depending so heavily on it.Floridaâs power providers and their state regulators, however, havenât reconsidered their strategy. In fact, theyâre doubling down on it.More gas-fired electricity generation is under construction or planned in this state than in all but four others, U.S. Energy Information Administration records show. The building boom includes not only these plants but also a hotly contested tri-state pipeline to feed them. The new construction follows a 15-year surge in gas-fueled electricity production in Florida that topped the nation, outstripping even major gas producers such as Texas and Pennsylvania.More: Tesla delivers solar power to Puerto Rico hospitalMore: Possible Trump tariff: Is the U.S. solar industry boom in jeopardy?Never in its history has the industryâs key regulator, the state Public Service Commission, rejected a utility gas plant. The agency has repeatedly raised concerns about increasing reliance on gas, but its actions have moved the state further in that direction.Now, even as theyâre finally accelerating solar development, Floridaâs electric utilities still expect to construct more than twice as many new megawatts powered by gas in the next decade as by the sun. Near Vero Beach on Floridaâs east coast, this struggle is on display.On land next to citrus groves, workers are installing more than 300,000 panels for a new Florida Power & Light solar site, one of eight the utility has under construction. Together, theyâll nearly triple FPLâs solar-powered portfolio. But about 20 miles west, the company is building a gas-fired plant â among the three biggest planned nationwide â that will power far more homes than all those solar sites combined.The Florida power users group, representing large industrial electric customers, was among those trying to convince the Public Service Commission two years ago that the $1.2 billion-dollar Okeechobee gas plant wasnât necessary. Solar would be a cheaper, smarter alternative, the group argued.âThe proverbial âYou don't want to put all your eggs in one basketâ comes to mind,â Jon C. Moyle Jr., the groupâs attorney, said at a hearing.FPL, the largest Florida electric utility, said falling costs are now making solar competitive and this power source should rise to 4%of the company's electricity mix by 2023. Thatâs a significant hike. But it falls far short of top solar utilities such as Pacific Gas & Electric in California, already at 13%last year.Gas remains key to FPL's plans. Its switch from oil and coal over several decades has been an unalloyed positive, bringing cheaper electric bills, cleaner air and fewer climate impacts than many other power providers, said Matt Valle, FPLâs vice president of development.âWeâre completely unapologetic about making that shift,â he said.More: Battery storage: Energy giant bets on breakthrough within 5 yearsMore: Why can't Millennials bank on clean energy jobs? Low-cost oilBut gas plants developed in Florida havenât simply displaced dirtier fuels. Theyâre also serving growing areas or replacing older gas plants, expanding the reach and lifespan of fossil fuels in a region especially vulnerable to their side effects.Floridaâs three largest planned gas projects â two plants under construction and one plant FPL aims to rebuild â would pump out roughly 9 million tons of climate-warming carbon dioxide per year over their decades-long operating lives, according to the non-profit Rocky Mountain Institute, which promotes cutting carbon emissions.The state wouldnât need so much gas if it prioritized energy efficiency to avoid expensive new power plants. But energy conservation costs Florida utilities money because they sell less power. Three years ago, the Public Service Commission cut conservation goals by 90%after the utilities argued they were no longer economical. This year, a national energy-efficiency non-profit, comparing the largest electric utilities on conservation efforts, ranked Floridaâs among the worst.Rooftop solar is another alternative. The state could offset nearly half its electricity needs this way, according to a 2016 federal analysis. But that too would threaten utilitiesâ profits because they donât own those panels or the resulting power â their customers do. In 2014, the companies convinced the Public Service Commission to ax the stateâs solar rebate program. Last year, they spent more than $20 million promoting a purportedly pro-solar ballot amendment widely panned as precisely the opposite.Even without more conservation or solar, the state could have ensured that utilities build only those power plants Florida needs.The commission said it carefully weighs all its decisions to balance customersâ and utilitiesâ interests. Its deputy executive director for technical matters, Mark Futrell, said commissioners have seen value in â for instance â replacing old gas plants with more efficient new ones requiring less fuel for the same amount of energy.But the watchdog group Integrity Florida concluded in a recent report that the system is effectively rigged in favor of the companies. Floridians representing consumers, businesses, environmental interests and state government echoed that finding in nearly 40 interviews with the Center for Public Integrity. They pointed to the millions of dollars the major utilities spend on campaign contributions that flow to state officials, many with a say over appointments to the five-commissioner agency, and the 96 lobbyists working on those companiesâ behalf.âThe power the utility industry has . . . is enormous,â said Mike Fasano, a Republican who served in the state Legislature for two decades, âand anyone that tries to tell you differently is lying.âThe story of natural gas in Florida is also a story of FPL, which serves roughly half the stateâs customers. The company, based in Juno Beach, started down this road to wean itself off oil. Then natural-gas prices jumped more than fivefold in the U.S. between early 1999 and mid-2008, with some of that increase ending up in utility bills.In 2004, as FPL again sought to pass on higher fuel costs to customers, its officials said they would diversify their electricity generation to blunt such swings.Instead, FPL doubled its reliance on natural gas. Hydraulic fracturing â fracking â unlocked gas from shale, and that supply rush tanked prices beginning in 2009. Suddenly gas looked like a smart choice. Fuel diversity, not so much.FPL said its strategy has saved consumers $8.6 billion in fuel costs and prevented 108 million tons of carbon emissions since 2001.Its residential customers pay 19%less for each kilowatt-hour of electricity than do average Americans, according to federal figures for 2016. If the Obama-era Clean Power Plan were in effect, FPL said it would already be in compliance far ahead of schedule â with coal just 3.5%of its mix and falling, its rate of carbon emissions is 30%better than the national average. Even replacing old gas plants with new ones substantially reduces those emissions, FPL said.What upsets critics isnât the shift to gas, but the extent of it â and that FPL and other Florida utilities are still adding gas plants. The electric grid covering most of the state is on track by 2021 to have the largest share of gas generation among all the U.S. and Canadian regional grids overseen by the North American Electric Reliability Corp., a regulatory body. This high reliance carries risks, the organization noted.Past governors called for more renewable energy. Bush, a Republican who served from 1999 to 2007, worried about over-reliance on gas. Charlie Crist, the Republican-turned-independent (and later Democrat) who followed him, feared the consequences of global warming and pushed the state to take action, winning no friends in the utility industry.His successor, heavily backed by utilities, has different priorities. Republican Gov. Rick Scott put an FPL executive on his transition team, supported the Sabal Trail pipeline and made national news for banning the stateâs environmental protection agency from even referring to climate change.A 2017 ranking of states for the ease with which companies can use renewables, compiled for retail and information-technology trade groups, puts Florida sixth from the bottom. The state was 15th in the country for total solar generation last year, bested by less sunny places and far outstripped by other high-potential locales.North Carolina â headquarters of Duke Energy, which runs Floridaâs second-largest utility â has nearly six times the electricity powered by rooftop and large-scale solar, according to Energy Information Administration data. If No. 1 California stopped building solar altogether and Florida added as much new production every year as it has right now in total, they wouldnât pull even until 2048.Asked when it might reach 50%renewable power, FPL said that âsetting an arbitrary goal for energy from renewable resources comes at a high cost and with reliability concerns.â California has high electricity rates, FPL notes â though other factors have contributed, including an overbuild of gas-fired power plants.Both FPL and Duke Energy said precipitous price drops only recently made solar competitive with gas in Florida, among the minority of states without a requirement for utilities to hit renewable targets. The state requires a cost-driven approach, and FPLâs Valle said his company jumped on solar as soon as the economics worked.âWeâre building more solar than just about any other utility in the nation now,â he said.Florida utilities told the state this year that theyâre expecting to build 4,000 megawatts of solar and 8,900 megawatts of gas-fired power plants in the next decade. FPL planned about 2,100 megawatts of solar, which itâs now on track to build by 2023, and 2,900 megawatts of new gas-fired generation, retiring both coal and older gas units in the process.In August, Duke Energy Florida agreed to build 700 megawatts of solar over the next four years rather than the similar amount it had expected to spread over a decade, along with a battery-storage project and more than 500 electric-vehicle charging stations. Still, the utility is also building a 1,640-megawatt gas plant. It will be capable of making more electricity than the coal units the utility plans to retire next year and the incoming solar combined.The transition from fossil fuels isnât going faster because the company must consider customersâ interests, said Tamara Waldmann, director of Duke Energy Floridaâs distributed generation strategy and renewables. âWe want to be mindful of the affordability of electricity in our state.âThe shift across the country to cleaner electricity isnât a simple exercise. Utilities must grapple with potential solar tariffs, tax policy, the likely future cost of battery storage, the best way of using intermittent energy sources. To make it easier and reward utilities for steps like helping customers use less power, some states have changed their regulatory structures by de-linking electric sales from revenues.Florida has not.Itâs hard to tell how much of Floridaâs situation is driven by regulators as opposed to the companies they oversee. Investor-owned utilities, especially in recent years, have so much clout here.The four largest of these utilities influence state lawmakers through political giving â in the 2016 election cycle alone, about $1.4 million to the Republican Party, $376,000 to the Democratic Party, at least $1.5 million to political action committees supporting the governor and other major state officials, plus direct contributions to about 80%of serving state legislators. They influence appointments to the Public Service Commission, according to the Integrity Florida report, a process in which both the Legislature and governor play a role.They even influence the commissioners, who know from experience that a good job in the industry could await âif they do the bidding of the electric companies,â said Aubrey Jewett, a University of Central Florida political science professor. At least three former commissioners are lobbyists for electric utilities in the state.Commission officials also realize if they push back too much, theyâll lose their jobs, said Timothy Devlin, ousted as executive director of the agency in 2011. The same happened to four commissioners in 2010.Early that year, those commissioners voted to approve just 6%of the nearly $1.3-billion rate hike FPL asked for and rejected the $500 million increase Duke Energyâs predecessor requested. All were drummed out within months, two by the state Senate and the rest by a legislatively controlled nominating council.FPL spokesman Dave McDermitt said in a statement that claims about its pull in the state capital are âludicrous charges by individuals or organizations with an old axe to grind or who are trying to advance their own political and/or policy agendas.â Of FPLâs spending on lobbying â seventh-highest in the state â and roughly $15 million in political giving in the 2016 election cycle, he said, âLike most Americans, we participate in the political process.âThere certainly seems to be no friction between the utilities and the commission anymore. At a regional conference last year, Julie Brown, its chair, welcomed the crowd of state utility regulators and industry executives, including from FPL and Duke Energy. She said she was looking forward to âthe opportunity to have dialogue with fellow sister commissioners from different states in the South, and you know, not be subject to [the public-record] Sunshine Law â¦ and really talk about the best practices,â according to audio recordings obtained by the Center.The commission declined the Centerâs requests to interview Brown and other commissioners. In a statement, it said Brown was simply encouraging commissioners from other states to strengthen their relationships with each other âand learn best practices.â The agency âvigorously strives to ensure that Floridaâs consumers receive reliable, safe service at a reasonable cost,â balancing consumersâ needs with those of utilities, it said in its statement.Jody Finver drew gasps as she showed her electric bills to a roomful of people in Miami Shores: under $10 a month, down from roughly $110 before she put solar panels on her roof. Finver was telling the crowd how to go solar cheaper with Solar United Neighbors of Florida, a non-profit helping people form co-op buying pools to get bulk discounts and technical assistance.Finverâs panels produce enough to power her house and then some.A chapter of an organization expanding around the country, the group formed in the middle of last yearâs battle over the solar amendment. It was kick-started by people like Deirdre Macnab, former president of the Florida League of Women Voters.Utilities say the state has low rooftop solar adoption because electric rates are cheap. But because Floridians use more electricity in their hot â and getting hotter â state, the average residential bill here is nearly 10%higher than (and FPLâs roughly the same as) the national average. Macnab, who paid $3,000 a year for electricity before solar panels reduced that by two-thirds, said the co-op pitch is simple: You can save, too.âWeâre trying to get the state to a tipping point,â she said.Solar United Neighbors of Florida has launched 19 co-ops, some still enrolling members and others that have helped about 500 households go solar. Six more co-ops are planned for January alone. Organizers are heartened by the demand â their waiting list for new co-ops extends through next fall â and by communities taking their own steps to move the needle.Among those is Orlando, a city trying to go entirely renewable by 2050. Leaders made that commitment knowing their utility would cooperate: Itâs municipally owned.Itâs also coal-heavy, so thereâs a lot of work to do. Chris Castro, Orlandoâs director of sustainability, thinks the goal is necessary and attainable. The city is trying everything: Amped-up conservation that propelled Orlando from the 30th to the 20th most efficient large city in the country in a 2017 ranking. A new solar site on a coal-ash landfill. A planned solar-with-battery-storage project. Panels on parking-lot roofs and a floating solar array in a pond.And rooftop solar? Orlandoâs utility is getting into the business. Taking a page from the co-ops, itâs launching a program to help customers aggregate their demand for lower prices.But the utility serves 250,000 households and businesses. FPL, with 4.9 million customers, shapes Floridaâs future in a bigger way.The Center for Public Integrity is a non-profit, non-partisan investigative news organization in Washington, D.C.