Florida Battles to Create a Clean Energy Policy Framework

In Brief

In this interview, Susan Glickman, Florida director for the Southern Alliance for Clean Energy, discusses the status of clean energy development in the state.

Glickman argues that utilities have historically stood in the way of policy that promotes renewable energy. "Florida is one of only four states with a law that prohibits anyone other than your government-assigned monopoly utility from selling you energy," she said.

She describes new opportunities emerging as costs have dropped, however. "Florida is moving into a leadership position in the southeast with utility-scale solar, and we're seeing increasing solar commitments from Florida Power and Light, Duke Energy and Tampa Electric Company," she said.

Susan Glickman

Susan Glickman / Bob Howard / CC BY-NC 2.0

In this interview, Susan Glickman, Florida director for the Southern Alliance for Clean Energy, discusses the status of clean energy development in the state. Glickman lays out policy battles over renewable portfolio and energy efficiency standards, the state’s history of natural gas consumption, growth in utility solar programs, and an effort to deregulate the state’s utility industry. This transcript has been lightly edited.

CEFF: What obstacles has Florida faced on clean energy? Where have there been successes?

Glickman: Florida is woefully behind where we should be on energy efficiency and the deployment of solar. Historically, the monopoly utility companies have blocked policies that would advance the capture of cost-effective efficiency and particularly rooftop solar. Florida is one of only four states with a law that prohibits anyone other than your government-assigned monopoly utility from selling you energy. Utilities have argued every reason why they can't help consumers be more efficient. Historically we've really lagged behind and that has been due to the influence of the big investor-owned utilities.

Thirty-plus states have a target for renewable energy — most often known as a renewable portfolio standard (RPS) — and in 2009 the Florida Senate passed a bill to create an RPS, but it was rejected in the House of Representatives and never took hold. Most states have integrated resource planning where supply and demand is considered on a level playing field, and usually results in an atmosphere where renewables and energy efficiency are valued. But in Florida there is a need determination process at the state Public Service Commission: When utilities want to build a new power plant, they have to go in and prove that they need to build that power, and they can't meet that need more cost-effectively with energy efficiency.

During this process, utilities argue for every reason why they can't use less energy, and can't help consumers. The current argument is that because of new building codes and appliance standards everyone is already more efficient. But in the American Council for an Energy-Efficient Economy’s 2018 scorecard, Florida scored only two out of a possible 20 points and ranked 36th in the nation for utility programs and policy. 

Florida is also over-reliant on natural gas. In 2005, we were 48% reliant on gas, and then Governor Jeb Bush — informed by what the utilities were asking for — brought us a policy to allow for advanced cost recovery for new nuclear power plants. The idea was that we were so reliant on natural gas that we needed fuel diversity. According to the Energy Information Administration, natural gas fueled about 70% of the Florida's electricity net generation in 2018.

That policy has been an utter disaster on every front. Duke Energy eventually ended up canceling its initial plan for its new nuclear plant. At the time they said the plant would cost $5-6 billion. When they canceled, the price-tag was $25 billion. In an effort to get fuel diversity we went down this nuclear pathway that ended up costing Florida consumers hundreds and hundreds of millions of dollars.

CEFF: What is the current state of the energy-efficiency market in Florida?

Glickman: The policies that we have seen move in the past have really met what utilities are asking for, which was to advance more expensive options. Energy efficiency flies in the face of the utility business model, which is where they get a guaranteed range of a rate of return on their capital expenditures, so the incentive is on putting concrete in the ground and to build more expensive generation sources rather than help people meet their energy needs with efficiency. Florida sends more than $50 billion out-of-state every year ($57 billion in 2017) to bring fuel in from elsewhere. So, the potential opportunity to keep those dollars in the state and create local jobs underscores that Florida energy policy has not helped economic development in the state in the way it could. 

One of the other hallmarks of the current era is that we're seeing interesting alliances between Tea Party conservatives, the business community, and the environmental community.

Because of building codes and appliance standards, we are seeing greater efficiencies. Plus more affluent people are making their homes and businesses more efficient, but people who are low- to middle-income and renters are the ones suffering and paying bigger power bills for the lack of utility efficiency programs.

Florida uses an outdated cost-benefit analysis called the “rate impact measure.” No other state uses that as the sole cost-benefit test. What that means as a practical matter — if you’re looking at an LED light bulb, for instance — it has a rate impact because it has a cost, but they don’t look at the life cycle costs. That’s a maneuver to avoid real gains in energy efficiency. When Florida utilities sit down with a conservation goal, the first thing they do is they take all of the low-cost measures off the table, because they say that people are already doing this, and we don’t want any free riders. Their argument is that we don’t want to incentivize something people are already doing anyway but the reality is that efficiency improvements are not being widely adopted. 

CEFF: What signs of progress have there been on solar in the state?

Glickman: We are seeing growth in solar both on residential rooftops and utility-scale solar. Southern Alliance for Clean Energy welcomes utility-scale projects, and we also want to make sure that families and businesses have the opportunity to put solar on their roofs as well. We now have 28,329 net-metered systems in Florida; that figure comes from the 2018 report from the Florida Public Service Commission. But that's out of a potential almost 10 million electricity customers in the state. So it is still a rather dismal number, although we have seen that number double and triple in somewhat recent years. It's the same thing with utility-scale solar farms as well.

One of the primary drivers of the growth of solar is simply the fact that the cost of solar has dropped exponentially. There are efforts in Florida in the residential market, where there's a program that was initially brought to Florida by the League of Women Voters, called Solar United Neighbors. It's a solar co-op concept. We have a Solar and Energy Loan Fund that is growing and providing not only financing for some solar projects, but energy efficiency and solar improvements for low- and middle-income residents. But the central reason that we're seeing more solar is that the cost of solar has come down.

CEFF: What further action should be taken in Florida on solar, energy efficiency, or clean energy more broadly to catalyze more forward progress?

Glickman: Renewables make economic sense today, so we need policy that creates a level and competitive playing field. One of the other hallmarks of the current era is that we're seeing interesting alliances between Tea Party conservatives, the business community, and the environmental community, because solar is now cheaper than building a new natural gas plant.

So it's not about favoring one technology. One could argue that in the earlier days, when you adopted targets for renewables, you were picking winners and losers, but that can't be argued now. The policies that we need are fair policies that provide for a level playing field. So if Florida were to require transparent integrated utility planning with stakeholders at the table, that would go a long way to show that rather than building new fossil-fuel plants, we can meet energy needs with energy efficiency and rooftop solar, and that is the most cost-effective solution at this time. It's really all about avoiding to build new generation or new power plants. That is what makes people's bills go up.

Battery storage and microgrids are another huge opportunity, that Florida — particularly vulnerable to strong hurricane seasons and other extreme weather events — needs to be advancing. The costs of battery storage and microgrids are starting to come down, and the technology is starting to become more efficient. Like the impact of solar prices dropping, storage costs dropping will open the door even further for that. 

CEFF: What do you think about the current push, opposed by many state utilities, to deregulate the electricity market? [On January 9th, the Florida Supreme Court struck down a proposed ballot initiative to deregulate the electric market, finding that the proposed amendment was misleading because its summary stated that it would also allow customers to sell electricity.]

Glickman: Interestingly enough, Southern Alliance for Clean Energy — which has often been in the position of battling the monopoly utilities — did not endorse the deregulation initiative. Our analysis is such that we don't see deregulation, in the next five or 10 years, achieving the greenhouse gas emission reductions we require. 

Florida has a good net-metering rule: where you're credited a retail rate for solar generation up to what you use. If you generate more than you use, they true up at a wholesale rate, but it's generally considered a good net-metering rule. If Florida was to deregulate, then net metering in the state would go away. That is of great concern to us.

I think the backdrop for Florida is that the climate crisis is an existential threat to our state and our economy.

And then we should consider also that the utilities are developing utility-scale solar in a more significant way, and are continuing to increase their commitment. Florida Power and Light has a program called “30-by-30.” They're going to install 30 million solar panels by 2030. So Florida is moving into a leadership position in the southeast with utility-scale solar, and we're seeing increasing solar commitments from Florida Power and Light, Duke Energy and Tampa Electric Company. 

Florida Power & Light now has a program called SolarTogether that allows local governments and other larger users to buy into a true community solar. Between the 30-by-30 commitment and the SolarTogether program, we’re seeing a real shift with the big investor-owned utilities in the state. And deregulation just does not guarantee that that will continue to be the case. 

CEFF: Is there anything else our readers should be sure to know?

Glickman: I think the backdrop for Florida is that the climate crisis is an existential threat to our state and our economy. Tourism, agriculture, real estate and ports are the pillars of Florida’s economy. Climate change also threatens our public health. We have so much to lose. It’s heartening now to see Florida begin to move on solar, but there’s more we can do with energy efficiency. The threat is real; Floridians are already feeling the heat and paying the price. Already our local governments are paying enormous amounts of money, and citizens are paying enormous amounts of money through their taxes to adapt to climate impacts in the pipeline.

It’s essential that we dramatically reduce our emissions so we don’t make that sea level rise worse. Miami Beach has already passed a billion dollars in costs for climate adaptation. Historically, Florida has been slow to move, but we’re starting down that path now and there is much more that we could and should do.

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