Case Background
On August 14,
2017, Duke Energy Florida, LLC (Duke) and the Reedy Creek Improvement District
(Reedy Creek) filed a joint petition for approval of an amended territorial
agreement (proposed agreement) in Orange and Osceola Counties. The proposed
agreement is contained in Attachment A. The maps and written descriptions
delineating the area to be served by the proposed agreement are provided in the
petition as Exhibits A and B, respectively. Additional maps are contained in
the joint petitioners’ response to staff’s data request filed in this docket on
August 31, 2017. Due to the voluminous nature of Exhibits A and B and the maps
provided in the data request response, they have not been attached to this
recommendation.
The joint
petitioners’ territorial agreement was approved by the Commission in 1994 and
amended in 2010 (existing agreement). The expiration date of the existing
agreement is September 30, 2017. The joint petitioners stated that they will
abide by the existing agreement until the Commission approves the proposed
agreement. The Commission has jurisdiction over this matter pursuant to Section
366.04, Florida Statutes (F.S.).
Discussion
of Issues
Issue 1:
Should the Commission approve the proposed agreement
between Duke and Reedy Creek?
Recommendation:
Yes, the Commission should approve the proposed
agreement between Duke and Reedy Creek. (Ollila)
Staff Analysis:
Pursuant to Section 366.04(2)(d), F.S., and Rule
25-6.0440(2), Florida Administrative Code (F.A.C.), the Commission has jurisdiction
to approve territorial agreements between and among rural electric
cooperatives, municipal electric utilities, and other electric utilities.
Unless the Commission determines that the agreement will cause a detriment to
the public interest, the agreement should be approved.
Reedy Creek is
a special taxing district created by the Florida legislature. Reedy Creek
operates like a municipality in that it is authorized to furnish electric
service to areas within its defined legal boundary; however, pursuant to its
charter, Reedy Creek cannot furnish retail electric power outside of its
boundary. Reedy Creek is authorized to furnish electric power to areas in
Orange and Osceola Counties.
There are three
differences between the existing and proposed agreements, as explained by the joint
petitioners in their response to staff’s data request. First, the proposed
agreement includes modified territorial boundaries. Second, the territorial
boundary maps in the proposed agreement have been updated to a geographic
information system (GIS) format, thus displaying the boundary lines in greater
detail. Third, the term of the existing agreement is 23 years and the term of
the proposed agreement is 30 years. After the expiration of the 30-year term of
the proposed agreement in 2047, the agreement would remain in effect until and
unless either party provides written notice of termination no less than 12
months prior to the termination date.
The proposed
territorial boundary changes involve three areas. The boundary changes include
two areas, which have been de-annexed by Reedy Creek and will be served by Duke
under the proposed agreement: the Black Lake parcel and an area in the vicinity
of I-4 and Osceola Parkway. The third boundary modification, an area in the
vicinity of County Road (CR) 535 and Apopka Vineland Road, is in the Reedy
Creek political boundary and is served by Reedy Creek; however, the area was
previously shown as served by Duke. The three boundary changes are detailed in
the joint petitioners’ response to staff’s data request. There are no customer
transfers and no facilities will be purchased or transferred; therefore, no
noticing was required pursuant to Rule 25-6.0440(1)(d), F.A.C.
The joint petitioners assert that the proposed agreement
will avoid duplication of service and wasteful expenditures, it will protect
the health and safety of the public from potentially hazardous conditions, and it will not cause a
decrease in the reliability of electric service. The joint petitioners believe
and represent that the Commission’s approval of the proposed agreement is in
the public interest.
Conclusion
After review of the petition, the proposed agreement, and
the joint petitioners’ response to staff’s data request, staff believes that
the proposed agreement is in the public interest and will enable Duke and Reedy
Creek to better serve their current and future customers. It appears that the
proposed agreement eliminates any potential uneconomic duplication of
facilities and will not cause a decrease in the reliability of electric
service. As such, staff believes that the proposed agreement between Duke and
Reedy Creek will not cause a detriment to the public interest and recommends
that the Commission approve it.
Issue 2:
Should this docket be closed?
Recommendation:
If no protest is filed by a person whose substantial
interests are affected within 21 days of the issuance of the Order, this docket
should be closed upon the issuance of a Consummating Order. (Janjic)
Staff Analysis:
If no protest is filed by a person whose substantial
interests are affected within 21 days of the issuance of the Order, this docket
should be closed upon the issuance of a Consummating Order.
