Diversifying State Energy Portfolio Could Be Difficult

May 11, 2018

Credit Lance Cheung

With the state’s energy portfolio surpassing 60 percent natural gas, Florida’s utility regulators are pushing for greater diversity.

During a recent meeting, as member of the Public Service Commission approved plans for new power plants in the state, Commissioner Donald Polmann raised concerns about what he sees as a trend toward greater dependence on natural gas.

“Across Florida we see a  shift toward a greater reliance on a single fuel type," Polmann says.

Polman says he can understand why companies are switching to natural gas, but he says the commission may need to begin taking a broader view of the issue.

“In larger picture there can be some concerns about further consolidation to natural gas looking at the fleet of electric generation across the state and I think it may be appropriate for this commission to continue to consider that in the larger picture,” Polmann says.

Commissioner Gary Clark and Chairman Art Graham say they agree with Polman’s assessment. But Graham points out, while he’s open to more diversity, it is difficult to discourage natural gas use.

“The problem you’ll run into though is right now, and especially with the facts that came before us in this case, the price of natural gas is the prudent thing to do,” Graham says.

Natural gas accounts for more than 62 percent of the state’s energy production, with coal making up 17 percent, nuclear at 14 percent and renewable energy, like solar, making up just about three percent. But changing that distribution may be difficult. On the same day commissioners considered the natural gas power plants, they also heard a request to let Tampa Electric recover costs for a solar project. Mark Ward oversees solar strategy for Tampa Electric. In order for solar projects to be cost effective for his company a number of factors had to align. For example Ward says a property tax break "helped solar be cost effective."

Ward says another factor that helped is that Tampa Electric purchased the modules or solar panels at a time when they were less expensive.

“What I do know is that modules were more expensive than they were a year ago and there’s less supply right now,” Ward says.

A report from the Southern Alliance for Clean Energy shows despite progress from utilities, Florida falls below average for utility scale solar production compared to other south eastern states.