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Why are FPL rates lower than other utilities in Florida?

Florida Power & Light Company is the third-largest electric utility in the United States, serving approximately 4.9 million customer accounts or an estimated 10 million people across nearly half of the state of Florida.

FPL's typical 1,000 kWh residential customer bill is approximately 25 percent lower than the latest national average and, in 2016, was the lowest in Florida among reporting utilities for the seventh year in a row.

A number of different surveys of the utilities industry had ranked Florida Power and Light as the number 1 utility in the united states. Florida Power and Light bucks the trend of other states in that it is an investor owned utility but unlike publicly owned utilities in other states, offers cheaper power than its peers.


There are several reasons why they are able to offer power at cheaper prices:

  • They were very early adopters of smart meters which has allowed them to have a very detailed picture of usage of electricity on their network.
  • Without stating the obvious, they have a massive number of customers on their network from which they can recover the cost of maintaining and managing their 70,000 miles of power lines.
  • They have very efficient generation facilities including wind, solar and nuclear that offer low cost generation.

The low cost of FPL power means there is less to save from all power cost savings options than there is in some other utilities but it is still worthwhile making sure that you are on the cheapest plan for your usage.

A summary of Florida Power and Light residential rate plans

FPL offer both Tiered and Time-of-Use rate plans to their residential customers.

A Tiered rate plan is a plan where the amount you pay per kWh for electricity increases as the quantity of electricity you use increases. Generally there is an allowance of kWh's (kilowatt hours) per month at a cheaper rate and then use above this allowance is charged at a higher rate.

Most Florida Power and Light residential electricity customers are on the RS-1 Plan which is a standard Tiered plan.

This means FPL customers pay one rate for power up to 1000 kWh per month and a slightly higher rate for power usage above 1,000 kWh per month.

The rates work out to 10.254 cents for power usage up to 1,000 kWh per month and 12.254 cents. This includes the current storm repair charge of .33 cents per kWh.

This means a customer with a usage of 1500 kWh per month would have a total electric bill of $163.81 on the RS-1 Tiered rate.

A Time-of-Use electric rate plan is an electricity plan where the amount you are charged per kilowatt hour (kWh) for power is determined by the time of day that you use it.

They typically have peak times of the day with higher rates and an off peak with lower rates.

FPL rate plans

Plan Name: Residential (RS-1)
Last Update: March 1, 2018
Fixed Charge: Service Charge: $8.01
Rate per kWh
Tier1: $0.089
Tier2: $0.109
Energy in Tier
Tier1: First 1,000 kWh
Tier2: Above 1,000 kWh
Plan Name: Residential - Time of Use (RTR-1)
Last Update: March 1, 2018
Fixed Charge: Service Charge: $8.01
Summer (April 1 to October 31)
Rate per kWh
Off-Peak: $0.04
Peak: $0.199
Weekday Times
Off-Peak: Midnight to noon, 9pm to midnight
Peak: Noon to 9pm
Weekend Times
Off-Peak: All hours
Peak:
Winter (November 1 to March 31)
Rate per kWh
Off-Peak: $0.04
Peak: $0.199
Weekday Times
Off-Peak: Midnight to 6am, 10pm to midnight
Peak: 6am to 10am, 6pm to 10pm
Weekend Times
Off-Peak: All hours
Peak:
Summer (April 1 to October 31)
Rate per kWh
Tier1: 00
Tier2: $0.02
Energy in Tier
Tier1: First 1,000 kWh
Tier2: Above 1,000 kWh
Winter (November 1 to March 31)
Rate per kWh
Tier1: 00
Tier2: $0.02
Energy in Tier
Tier1: First 1,000 kWh
Tier2: Above 1,000 kWh

What are FPL's peak and off peak hours?

Florida Power and Lights peak are Noon until 9 p.m weekdays and other hours are off peak.

What are FPL's residential Time-of-Use plans?

As a residential customer you only have one residential Time-of-Use plan to choose, which is known as RTR-1.

The way this plan works is that currently you are charged in total 17.05 cents per kWh for energy used during peak times, but then only charged a much lower rate for usage at off peak rates of around 3.13 cents per kWh.

After thoroughly going through the fpl.com website I actually can't find a bill example or explanation for the RTR-1 rate, but I think I have got it about right. It is very difficult to calculate the RTR-1 rate as it is expressed on the s sheet as adders and credits to the RS-1 rate. If I have got it wrong then I would love from hear from anyone with example bills who are on the RTR-1 Time-of-Use rate.

So let's take the example customer who's bill we discussed above and see how they would do on the RTR-1. Let's assume that this customer used 1500 kWh per month but they used 700 kWh from noon until 9 pm weekdays (peak) and 800 kWh's in off peak.

Compared to the RS-1 Tiered rate plan which would have a bill of $163.81, the same usage on the Time of Use RTR-1 plan would result in a bill of $144.39, a saving of $19.42.

The Energy Information Agency produced a report showing that the average electricity consumption by a Florida household is around 1300 kWh per month ranking its homeowners amongst the highest users of electricity in the United states. Given the hot and humid climate across much of the state, this high usage is not surprising.

Source: www.eia.gov/consumption/residential/reports/2009/state_briefs/pdf/fl.pdf

How do I work out if I am on the cheapest FPL rate plan for my usage pattern?

To work out whether you can save money each month by swapping from RS-1 to RTR-1 the easiest way to do this is to ask FPL to do a bill comparison for the two plans. Here is a link to their website but it appears you have to call them and request this.

To do this you need to get hold of your electrical data for the last 12 months in half hour intervals. This is known as interval data or sometimes also known as green button data.

 

Interval Data
Green Button data

 

Interval or Green Button data is your electrical usage data for the last 12 months in one hour (or even shorter) intervals. This data is available from your utility provider.

How do I get my interval data for the last 12 months?

This data is available from FPL. You can ring them and they are required by law to send it to you but you will probably be on hold for a long time and it will probably take forever. There is also a website called UtilityAPI that allows you to get this data for $15. They have an electronic interface to FPL.

However, if you own your home and it is a single family dwelling then a really good way to get this data for free is to request solar quotes from local solar companies.

Generally solar offers much bigger savings than swapping plans (as the plans are designed to give the same overall cost to average consumers) and a solar designer will usually need to get this same data to work out what size solar system would cover your bill and to forecast savings accurately for you.

Solar companies will usually retrieve and analyze your interval electricity usage data for free in the hope of winning your solar business.

See how much solar can save you in FPL territory

Calculate

How much can I save per month by swapping to my cheapest plan?

For most people the amount you can save by swapping plans is minimal because the electric plans are approved by the Florida Public Utilities Commission (FPUC) and plans are designed to work out roughly the same in terms of total costs for consumers with average consumption patterns.

In most cases savings will be between $0-$10 per month but could be much larger for high energy users or for homes and businesses with non-typical usage patterns that also install solar panels and move to the RTR-1 rate plan.

This is why most people in Florida who own their own homes are now looking at solar as the best method to reduce their power bill.

Even moderate electricity consumers with a monthly FPL bill of only $150 (with suitable homes) can save $30 or more (even after the solar repayment) a month by going solar and in many cases they can almost eliminate their power bill after the 7.98 years payback period.

You can use these links to find solar companies near you and solar panels costs in your city.

Find out how to reduce your FPL electricity bill.