How much does your FPL electricity really cost you?
The biggest objection for homeowners to go solar is cost. This is somewhat silly when you compare the monthly payment for a solar system with battery backup to the cost of your monthly FPL utility bill. And let’s be honest, you probably don’t review your monthly electric bill often. Not too many residential customers do until there is a noticeable jump in the amount owed.
So our team has put together this informational post to help you understand how to review your bill, see what you're currently being charged, and understand why solar power alternatives actually save you a significant amount of money long-term.
Breaking Down Your FPL Power Bill
For starters, there’s a good chance your utility company encourages paperless bill enrollment. In a time where everything is available online, opting for the digital variety seems like a benefit for you and the environment. But just like your Netflix, Amazon Prime, Hulu, etc. accounts, the "set it and forget it" convenience also means out of sight out of mind. You don't really know what you're paying for until you look over your expenses. And when you want to cancel a recurring monthly charge, it's not as easy as you'd think.
The same level of frustration sets in when you need to find a copy of your bill online because it can be a challenge. Companies intentionally make this difficult and confusing for consumers, which is why you've probably never seen or understood the incremental taxes and charges on your monthly bill.
4 of the Most Common Taxes and Charges on Your Utility Bill
Utility customers in Florida are charged hundreds to thousands of dollars in fees and taxes on their monthly utility bills each year. The sad part about this is that most homeowners have no idea they are being charged these taxes or fees. Here are the 4 most common charges and basic explanations of what each entails on your bill.
- Gross Receipts Tax: This is a tax that is mandated by the Florida Department of Revenue on the sale and delivery of electric power. It is approximately 2.5% of your total base power charge each month.
- Franchise Charge: This is one of those fees that most people know nothing about but pay anyway. It is essentially a fee in the amount of 3% to 6% of your electric bill that goes to your local jurisdiction so that FPL can have the right to run cables above and below streets in your area. For a prime example of how this charge pays royalties to your local municipality, you can read our supporting blog on Martin County by clicking here.
- Utility Tax: This is a 6.95% sales tax that all Florida utility customers must pay when purchasing electricity.
- Service Charges: These are fees the Florida Public Service Commission allows the utility company to recover for certain services provided. For example, a $25.00 fee for transferring, opening or reopening an existing account. And a $13.00 reconnect charge for reconnection of service after disconnection for nonpayment.
Click here to download the FPL rate breakdown PDF.charges for your electricity and programs offered.
Other Surcharges You Probably Aren't Expecting on Your FPL Bill
Unfortunately, those taxes and franchise fees aren’t where the questionable charges end. Your bill likely has a multitude of other line items listed under billing for services and products.
Examples of these costs include:
- HOME SurgeShield Program: This is a $9.95 monthly fee for a device that attaches to your meter to help prevent surges. In some cases, the homeowner never agreed to this installation or these monthly fees.
- Sales Tax: This is just a general sales tax on service. It’s usually under a dollar or two per month, but it is still a charge on your bill that adds up over time.
- Discretionary Sales Surtax: This is a tax levied by your local county for the same reason as the franchise charge.
- Storm Surcharges: This is the money your local utility spends on preparation or restoration for major storms including hurricanes and tropical depressions. The utility company seeks financial recovery for these efforts from its rate payers and issues storm surcharges on their bills. FPL has typically sought storm cost recovery from regulators. Customers paid surcharges through their bills for 2016′s Hurricane Matthew. But then the utility agreed in 2018 to refund its nearly $28 million of it after the Public Counsel claimed “over-recovery."
Does FPL Pass Along Any Savings or Tax Breaks to Rate Payers?
The state’s largest utility was allowed in by regulators to keep about $772 million in annual federal tax savings. Other utilities in Florida, including Tampa Electric Co. and Duke Energy, passed on their tax savings to customers. The savings resulted from the tax reform law of 2017, which lowered the corporate income tax rate from 35 percent to 21 percent. The tax changes were signed into law just three months after Irma. Commissioners said they considered FPL’s rates and the 11.5 percent profit the utility is allowed. If FPL went above that range, it would consider the need for new rates. Commissioners said FPL has a unique rate structure, agreed to in 2016, that doesn’t include a provision for a tax windfall.
Why FPL Customers are Switching to Solar
Solar Power Eliminates Utility Taxes, Fees and Surcharges and Helps Homeowners Save Instantly
If you’ve been following along with a copy of your monthly utility bill, you can quickly see how these additional costs add up to hundreds of dollars a year. Most homeowners and commercial property owners don’t realize how many tax benefits and incentives there are to go solar.
According to the PSC, customer-owned renewable generation installations (solar panels and backup batteries) increased last year by 57 percent over the previous year.
For example, there are no sales tax charges associated with solar panels or being off the conventional power grid.
The best part is, you are able to own your system for $0 upfront costs, which means you choose your own locked in payment terms. You're no longer subject to rate increases, storm surcharges, or any other random fees FPL may hit you with.
According to a ZIllow 2019 case study, Florida homes with solar increase 4.6% in value.
Lastly, there is a proven property value increase upon installation of a solar system, meaning your home value increases day 1. And unlike pool additions or other home improvements, solar does not increase your property taxes. Pretty cool, right?
Now, Florida homeowners who switch to solar qualify for a Federal Income Tax Credit valued at 26% of the system purchase price. There are no sales taxes or incremental tax charges associated with solar. But this tax credit incentive expires December 31,2020 and gets reduced to 22% in 2021.
Solar + Tesla Powerwall Give Your Home Power 24/7, Even in a Storm or Outage
This system automatically becomes your home's source of energy 24/7 - even during a storm or outage. SunPower panels are made to endure extreme weather conditions in South Florida, like 200 mph winds and rain, and meet strict building codes. And Tesla Powerwall keeps your AC blasting, refrigerator running and lights on without the frustration of upkeep, fuel or noise.
Now Solar and Tesla Powerwall make FPL and generators obsolete for home use. High efficiency solar panels make plenty of energy during the day to power your home and store additional excess energy in your Tesla Powerwall system to provide stored solar energy all night long until the sun comes up the next day to begin filling up the Powerwall again. When the electric grid is up and running, any excess energy not consumed is sold back at fair full retail credit (in most Florida areas).
Eliminate Your FPL Bill, Get Instant Savings with Vinyasun
So now that we've brought this to your attention, does FPL really seem like it's a better option than solar? Do you still think it's too expensive? The answer is obviously no... 😎
We’re proud to be one of the most trusted names in solar power in South Florida. Please contact our Vinyasun sales team today to schedule a “virtual” consultation appointment. We'll provide you with a free system design and quote and help you determine if solar is the right option for you.
We're Your Local Solar Experts - This is Why
We live where you live. Florida. Our process allows you to meet with a member of our team through a remote, virtual consultation using the Zoom Video platform. This first step will help us and you better understand how we can be helpful to you. We will use our high resolution satellite images to measure your roof, pin point any potential issues that might shade your roof even for a few days out of the year, to show you how much energy value your home can produce.
Click here to schedule time with us to get your free system design and quote from "virtually" anywhere