TAMPA — In an apartment dimmed by drawn blinds to keep temperatures down, Krystal Pate weighs how to pay her bills. Rent always comes first. Then, she tries to put a dent in her growing balance with Tampa Electric.
Housing and grocery prices were already rising when recent hikes in Pate’s electricity bills added pressure. Last year, Pate often spent well over $300 a month to power her three-bedroom apartment in South Tampa, where she lives with her five kids.
A faulty air conditioning unit added more stress. One month her bill climbed to $455.
In recent years, Floridians experienced a dramatic spike in energy costs, according to a Tampa Bay Times analysis of data from the U.S. Energy Information Administration. Two years ago, energy prices in the state jumped about 17% and kept rising, contributing to a surge in cost-of-living expenses in the region made worse by higher inflation. Those who feel the effects most deeply were already struggling.
After a hip and leg injury years ago, Pate has had trouble working, she said. Her family depends mostly on her oldest son’s wages busing tables at the Westshore Yacht Club to pay the bills.
“Even talking about it breaks my heart because it’s hard to live,” she said. “Putting this on my son, it’s not fair.”
What’s driven the cost hikes
Last year, Florida’s energy bills were the fourth-highest in the nation, the Times found, up from 13th a decade before. Customers paid an average of about $168 a month.
Numerous factors contribute to the costs energy companies pass on to consumers, but in recent years the volatility of natural gas prices have been critical.
Two decades ago, natural gas surpassed coal as the No. 1 fuel burned to create electricity in Florida, and its use has taken off since. Now 74% of the state’s electricity is generated from natural gas — nearly twice the national average. As a result, Florida produces less electricity from coal and renewable sources than many other states.
Tampa Bay’s leading energy providers maintain the fuel is a reliable and efficient energy source that plays an important role in Florida. Both Tampa Electric and Duke Energy noted the companies are steadily enhancing production of solar energy and investing in ways to use less fuel.
Still, reliance on natural gas has made the state vulnerable to its cost fluctuations, according to reports prepared for the Times by the Florida State University Center for Economic Forecasting and Analysis.
From 2020 to 2022, the price of U.S. natural gas more than doubled, an increase that Julie Harrington, the director of the economic forecasting center, called “incredible.”
“It is alarming to just see these prices keep rising markedly the last couple of years,” she said. “It’s like an apocalypse.”
Complex factors, including the Russian invasion of Ukraine, contributed, Harrington said, as the U.S. banned the import of natural gas from Russia, a major global supplier. Abnormally high temperatures in the summer of 2022 and ramped-up worldwide economic activity following the pandemic also increased demand, researchers noted.
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Explore all your optionsWhile the price of natural gas has begun to stabilize, some of the decreases since 2022 have still been for aberrant reasons. A fire at a key natural gas export facility in Texas forced the facility to shut down, which meant less domestic natural gas shipped overseas and more supply in the U.S. market, Harrington said.
“There was a convergence” of factors, she added, which means prices may continue to drop slowly, “until another catalyst gets it moving again.”
But even though the price dropped, there has been a lag in translating that relief to consumers. Duke Energy and Tampa Electric have twice filed paperwork with state regulators to lower the amount customers pay for fuel, the full extent of which could be felt starting this summer, the companies said. Florida utilities do not profit from fuel, passing the cost directly to consumers’ bills.
“Primarily in the last two years, (the increase) really has been around the cost of natural gas, which was nearly three times more than it historically had been,” said Melissa Seixas, president of Duke Energy Florida, at a March news conference. The company was announcing a utility assistance program administered by St. Petersburg. “Our customers felt that directly. There are absolutely ways that we were trying to offset those, including continued investments in solar, which then helps to decrease the utilization of certain fuel sources. … We’ll continue to have 100% commitment to reducing those costs.”
Some say utilities share the blame
Over a five-year period, the average Tampa Electric bill went up 51%, a Times analysis of federal data through 2023 shows. The average Duke Energy bill rose 28%.
Cherie Jacobs, a Tampa Electric spokesperson, noted the company temporarily reduced prices during the pandemic four years ago. But in subsequent years, data shows prices rose to unprecedented levels, and quickly. After reducing prices about 4% in 2020, the average TECO bill went up about 11% the next year — more than double the rate of annual change in any recent years.
Meanwhile, both companies have filed requests with state regulators to raise their customers’ base rates — a major component of energy bills — by millions of dollars starting next year. The hikes must be approved by the Florida Public Service Commission, which is scheduled to hold hearings in Tampa Bay in June for local utility customers to weigh in.
The requests show how the utility companies bear some responsibility for the spike in bills, critics say.
Clean-energy advocates point out that Florida’s grid would not be so vulnerable to fuel price swings if more of the state’s energy came from renewable sources. There’s no guarantee there won’t be more turbulence in fossil fuel costs in the future, given multiple ongoing wars overseas.
In its request for a base rate increase, Duke Energy has noted that other costs for things like storm resilience will be expiring from customers’ bills, predicting customers will pay less next January. Tampa Electric has said that dropping fuel costs could partially offset its request for increases.
Bradley Marshall, a lawyer with the environmental group Earthjustice, said these assertions are “true to a certain extent if you assume we’re not going to get hit by any more storms or fuel costs are going to hit this new low and stay this low forever,” he said. “Neither of those feel like safe assumptions.”
Marshall is representing multiple groups opposing the two companies’ cases before state regulators.
One reason both Duke and Tampa Electric have cited in their requests for increases is a desire to pay out a higher rate of return to their shareholders, called a return on equity. Both companies’ requested rates above 11% — exceeding the national average. Electric utilities nationwide were approved to make a 9.6% return on equity in rate cases last year, according to the research firm S&P Global.
Both companies say their requested rates are necessary. Ana Gibbs, a Duke Energy spokesperson, said it “represents a just and reasonable cost.” Interest rates have also gone up, “which makes it more expensive to run our business,” Gibbs said.
Jacobs at Tampa Electric pointed to inflation, higher labor costs and interest rates. When a utility is financially healthy, it can borrow money at better rates, which benefits customers, she said.
Jacobs added that last summer brought record temperatures. This meant air conditioners had to use more energy to keep homes cool — even if thermostats weren’t lowered. Floridians already use more electricity than residents in other states because of air conditioning, she said.
“Those issues combined in 2023 as a ‘perfect storm’ and drove up power bills for our customers,” Jacobs said.
Residents feeling the pinch
The communities most hard-pressed to pay their bills are often juggling several other risk factors, said Clara Reynolds, president and chief executive officer of the Crisis Center of Tampa Bay.
“When folks are calling us, it is really the problem of the day that is pushing them over the edge,” Reynolds said. “And it’s in that conversation that we’re really able to figure out what else is going on.”
In Hillsborough County, pleas to the crisis center for assistance with electricity and other utility bills nearly doubled in a single year. Over a one-year stretch ending in September 2023, the organization received more than 28,000 calls.
Reynolds said it’s clear from those conversations: energy bills are just one layer to the region’s challenges.
“They have issues in the child welfare system; they have issues in the juvenile justice system,” Reynolds said. “They have issues in the criminal justice system. There is unemployment, there’s (barriers to) transportation. The ZIP codes that typically reach out for support — the light bill is just one issue in a myriad of issues going on in their lives.”
St. Petersburg also received more than 3,600 applications for a new utilities assistance program with Duke Energy, less than a month after the initiative was announced in March. Three ZIP codes accounted for nearly three-fourths of the applications, all of which are in the southern part of the city, have a higher proportion of Black residents and more residents living below the poverty line than the Tampa Bay average.
In addition to having less money to pay bills, lower-income families tend to live in older properties that are less energy-efficient than new homes, research shows, which leads to higher costs.
When bills get tight in Jasna Ilisinovic’s St. Petersburg home, there’s never a question about which one rises to the top of the stack. Her husband has chronic obstructive pulmonary disease and relies on an oxygen machine to breathe — and the machine needs electricity. She marks the bill’s due date on her calendar each month.
So when the couple owed more than $300 last summer, as their older air conditioning unit strained to cool their 1970s home during a record-hot July, they needed help. The Pinellas County Urban League agreed to pay that bill and the next month’s, taking roughly $800 worth of stress off Ilisinovic, she said, who along with her husband receives disability benefits.
“Our electric bill is No. 1 because he can’t live without it,” Ilisinovic, 50, said, adding that they have tried to make their house more efficient with things like window curtains and new insulation. “Thank God for (the Urban League) to be here for us.”
Pate, 43, is still searching for a solution. Her kitchen cabinets are checkered with multicolor sticky notes, each one thanking God or one of her five kids for inspiring her.
When her unpaid bills feel insurmountable, she reads the neon squares to feel centered. She aims to keep a grateful outlook, remembering that “there’s people that don’t have a roof, lights or working water, and they still manage.”
As of March, she owed Tampa Electric more than $700.
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