Power Costs Will Significantly Decrease in Coming Years
Payoff of power plant debt cuts costs for FMPA’s power projects by one-third or more
ORLANDO, Fla., April 21, 2016 – Wholesale electricity costs will decrease significantly for Florida Municipal Power Agency (FMPA) members in the coming years as debt is paid off on four of its power supply projects.
FMPA staff presented information today at the agency’s Board of Directors meeting showing that debt will be paid off on two power projects by Oct. 1, 2019, and two other projects will be paid off by 2027.
Only four more payments
“We only have four more debt payments before the debt of the Stanton and Tri-City projects will be paid off,” said Nicholas Guarriello, FMPA’s general manager and CEO. “When these projects were originally financed in the mid-1980s, our plan was to pay them off in 2019. We are about to achieve that goal, and it feels good to help lower costs for our municipal utility members.”
When the debt is paid off, assuming the plant operates as much as it does now, wholesale power costs would be cut by 30 percent to 40 percent.
Seven municipal electric utilities that receive power from these projects will realize significant savings on their wholesale power costs beginning in 2019. The cities include Fort Pierce, Homestead, Key West, Kissimmee, Lake Worth, Starke and Vero Beach.
More debt to be paid off in 11 years
Further cost reductions are likely as two other FMPA power projects will be paid off in the next 11 years. FMPA’s St. Lucie Project will be paid off in 2026, and the Stanton II Project will be paid off in 2027. These projects will see cost reductions that are similar or even greater.
“The future looks bright for FMPA,” said Guarriello. “The lowest cost retail electric utility in Florida is served by FMPA. As we pay off the debt of some FMPA power projects, the cost of power should decline further.”
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Florida Municipal Power Agency (FMPA) is a wholesale power company owned by 31 municipal electric utilities. FMPA provides economies of scale in power generation and related services to support community-owned electric utilities. The members of FMPA serve approximately two million Floridians.