Res 46-77 RESOLUTION NO. 46-77
A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF DELRAY BEACH, FLORIDA, TO THE
FLORIDA PUBLIC SERVICE COMMISSION PRO-
TESTING THE INVERTED RATE STRUCTURE
ESTABLISHED BY THE COMMISSION IN REGARD
TO THE RATES OF FLORIDA POWER AND LIGHT
COMPANY.
WHEREAS, Florida Power and Light Company'applied to the Florida
Public Service Commission for rate relief October 8, 1976; and,
WHEREAS, the Florida Public Service Commission by order dated
June 16, 1977, awarded Florida Power and Light Company an overall rate
increase of approximately 16%; and,
WHEREAS, in implementing the approximate 16% average rate increase,
the Florida Public Service Commission ordered Florida Power and Light
Company to use an inverted rate structure rather than the traditional
declining block method; and,
WHEREAS, the inverted rate structure established a uniform c~arge
per kilowatt hour up to 750 kilowatt hours per month (the so called life~
line rate) and a higher rate for kilowatt hours used in excess of 750
kilowatts per month; and,
WHEREAS, the effect of this inverted rate structure places a dis-
portionate burden on some users to bear a greater percentage of the rate
increase than others; and,
WHEREAS, the apparent purposes of the inverted rate structure are:
(1) to subsidize low-income families on the assumption that
they use less energy than others and therefore will pay a lesser per-
centage of this rate increase awarded; and,
.(2) to create an incentive to conserve energy by raising the
kilowatt hour charge when consumption exceeds 750 kilowatts per month.
This based on the assumption that 750 kilowatts per month is the appro-
priate amount of monthly residential use while consumption in excess of
this amount is wasteful and should be discouraged by higher rates; and,
WHEREAS, the City Council of the City of Delray Beach objects to
the inverted rate structure as established because as to objective:
(1) no data was submitted to the commission indicating that
low income families use less energy than other families;and,
(2) no data was submitted to the commission which would justify
the cOnclusion that the "necessary" amount of monthly residential consump-
tion is 750 kilowatt hoUrs per month while consumption in excess of this
amount is wasteful; and,
WHEREAS, the inverted rate structure has a substantial adverse im-
pact on many of the citizens of the City of Delray Beach,
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
DELRAY BEACH, FLORIDA, AS FOLLOWS:
Section 1. That Florida Public Service Commission is hereby re-
quested to reevaluate and study the advisability of implementing an
inverted rate structure after competent substantial evidence has been
presented indicating the real economic and energy impacts of such a
rate structure.
Section 2. That while this matter is u~der study that the Florida
Public Service Commission order Florida Power and Light Company to im-
plement its recently granted.rate increase by the traditional declining
block rate structure.
PASSED AND ADOPTED in regular session on this the 22nd day of
August, 1977.
ATTEST:
Asst. City Clerk
- 2 -
Res. No. 46-77