If you like to gamble with your own money, fine. But how about someone else gambling with your money? And losing bigtime?
That's happening across Florida as the state allows electric utilities to what amounts to hedge bets on the price of natural gas. The Public Service Commission, official lapdogs to the utilities, this week unanimously voted to allow companies to continue this form of pick-pocketing.
By hedging, utilities purchase fuel now at a fixed price for use in the future. So if fuel costs rise above that betting line, the utility wins with lower bills, which must be passed on to customers. But if the companies lose the hedge, guess who loses chips in this poker game? Customers -- not utilities, not stockholders.
PSC commissioners gave some twisted logic in justifying their vote, something about reducing price volatility and a fickle market.
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The losses amount to $6 billion -- with $789 million just in 2015. Florida Power & Light turned out to be the biggest loser among state utilities, to the tune of $4 billion from 2002 and 2015. That's your money, as the state lets utilities pass all fuel costs onto customers.
Natural gas prices are low today, but utilities bought today's fuel at higher prices agreed to in the past. The companies make no money on winning bets, but take no losses on losing ones.
This is patently unfair and terrible public policy. But then, what should Floridians expect out of the PSC?