The city is paying $58,500 to a consulting firm to study the costs of transitioning to a municipal electric utility system.
DESTIN – City officials could find out by early August whether buying and taking over Gulf Power’s electric facilities in Destin is feasible.
The city is paying $58,500 to a consulting firm to study the costs of transitioning to a municipal electric utility system. The firm, WHH Enterprises Inc., is from the Lake County town of Howey-in-the-Hills.
Among other tasks, the company will provide the estimated cost of purchasing the electric facilities as well as a 20-year forecast of estimated annual revenues and costs to manage them.
Mayor Scott Fischer said Monday that since he was elected last year he has heard some complaints from residents about Gulf Power’s rates being too high.
“I’ve received far more complaints about Gulf Power not being willing to really discuss or provide underground utilities at a reasonable rate,” Fischer said. “I know that’s out of the company’s hands. That’s set by the state. But I think the company’s lobbyists (had some say in the matter).”
Gulf Power has been serving Northwest Florida for more than 90 years, company spokesman Rick DelaHaya said Monday in an emailed response to phone messages left by the Daily News.
"We have historically provided excellent service to our customers in Destin and look forward to continuing to serve their energy needs now and into the future," he said.
Destin officials entered into a 30-year franchise agreement with Gulf Power in May 1986. The agreement has been updated several times since then and currently is set to expire May 19, 2018.
“It behooves us to do some research and see if we can provide a better contract for the consumer,” Fischer said. “They have no choice: Once the city gives (the company) the franchise, the individual has to buy their power from Gulf Power.”
Once the consulting firm’s study is completed, “It could turn out that Gulf Power is the best provider for the city of Destin,” he added. “But until you do the research you don’t know that. I’m sure we’ll be presented with a number of options.”
As part of its study, WHH Enterprises will provide city officials with the current number of Gulf Power residential and commercial customers in Destin, city Information Technology Director Webb Warren said.
Gulf Power serves more than 450,000 customers in eight counties in Northwest Florida.
According to the nonprofit American Public Power Association, there are more than 2,000 community-owned electric utilities in the United States. They serve more than 48 million people, or about 14 percent of the nation’s electricity consumers.
During 2013, residential customers in investor-owned utility service territories paid average rates that were 14 percent above those paid by customers of publicly owned systems, according to the Arlington, Virginia-based APPA.
While some large cities such as Los Angeles, Seattle and Orlando operate publicly owned electric utilities, many public power communities with their utilities serve 3,000 or fewer customers, according to the APPA. It states that most of those utilities are governed by a city council, while others are overseen by an independently elected or appointed board.