Florida PSC Denies Duke's Large-Load Tariff: A 20-Year Contract, but No Rate Behind It

Duke Energy Florida asked the Florida Public Service Commission to approve a contract. The commission asked for a price. On November 3 it voted to deny Duke’s large-load tariff in Docket No. 20260064-EI, the first utility filing judged under the state’s new law on customers that draw 50 megawatts or more at one site ^[1,4,5]. Duke will have to refile ^[4].

What the commission turned down

Duke filed its petition on April 22, 2026, seeking a Large Load Customer Policy, a Large Load Customer Agreement and revised contribution-in-aid-of-construction tariffs ^[1]. Contribution in aid of construction, or CIAC, means the customer pays up front for the lines and equipment needed to reach it. The policy would have applied to any customer with a peak contract demand forecast at 50 MW or more at a single location ^[1].

The protections were not thin. The staff recommendation lists them ^[1]:

• a 20-year minimum contract term, which can include a negotiated load ramp;
• billing on a minimum demand of 75 to 85 percent of annual contract capacity, with Duke saying it would use 75 percent for every qualifying customer;
• 100 percent of the estimated cost to extend service paid in advance, refunded over up to five years if the load shows up;
• a termination fee of 36 months of minimum bills plus the net book value of the new facilities, less any unrefunded CIAC;
• a non-refundable system impact fee, and an affidavit that the customer is not a foreign entity.

What the filing did not have was a rate. Qualifying customers would have taken service on Duke’s existing GSD-1 and GSDT-1 schedules until a new rate class comes out of the utility’s next rate case ^[1]. Duke told the commission it would file a large-load rate schedule to take effect January 1, 2028 ^[1].

Commission staff, in an October 22 recommendation, gave two grounds to deny with leave to refile ^[1]. First, the tariff covered only firm load. The statute sets its 50 MW threshold with no such qualifier, so a customer asking for 100 MW of interruptible service would meet the law’s definition and still sit outside Duke’s protections ^[1]. Second, in staff’s words: “No evidence was provided by the utility to establish that these rates affirmatively cover the cost of serving each large load customer” ^[1].

The commission found both. According to the News Service of Florida, commissioners concluded that the tariffs excluded customers who otherwise qualify under the law, and that Duke had not shown its existing rate schedules plus its contract protections would make each large customer bear its full cost of service ^[4,5].

The two halves of Section 366.043

The law is CS/CS/SB 484. The House passed it 92-16, the Senate concurred 31-6 on March 13, and the governor approved it on May 7 as Chapter 2026-65, Laws of Florida ^[3]. It created Section 366.043, Florida Statutes, effective July 1 ^[1]. Subsection (3)(a) says the minimum tariff requirements “must reasonably ensure that each large load customer bears its own full cost of service and that such cost is not shifted to the general body of ratepayers” ^[1]. It names connection, incremental transmission and incremental generation among those costs, and closes: “The risk of nonpayment of such costs may not be borne by the general body of ratepayers” ^[1].

Staff read that sentence as two requirements. Duke’s case leaned on its 2024 rate settlement, which freezes base rates from January 1, 2025, through December 31, 2027 ^[1]. Staff agreed the freeze means no large-load costs can move onto other customers before the next rate case. Then it wrote that “the rate freeze only addresses half of the statute” ^[1]. The other half asks whether each large customer pays its own way, and a frozen rate designed for other customers does not answer that.

Nor, staff found, did the settlement tie Duke’s hands. Duke acknowledged the agreement would let it change rates in response to the new statute, so staff called reliance on GSD-1 and GSDT-1 through 2027 the utility’s “chosen approach, rather than a restriction imposed by the settlement” ^[1].

What changes for a project in Duke’s territory?

For now, the effect is on timing, not on a bill. No large-load tariff is in force for Duke until it refiles and the refiling is approved. Staff recommended that Duke be allowed to refile compliant tariffs within 10 business days of the written order, with staff reviewing them administratively and the new tariffs taking effect on the date staff signs off ^[1]. E+E Leader reported that no final order had been located as of November 5 ^[5].

Most of the contract terms passed staff review. Staff called the 20-year term reasonable, citing a comparison by Duke’s witness that put minimum terms in other states at 8 to 20 years ^[1]. It found the 75-to-85 percent minimum demand within the range of other states’ minimum bills, which run from 60 to 100 percent of contract demand ^[1].

Security was the exception. Duke’s collateral was a negotiated percentage of the termination fee, fixed only at a floor of 10 percent when that fee tops $100 million ^[1]. Staff said that leaves too much flexibility, and recommended Duke be given the option to refile with the Office of Public Counsel’s design: collateral equal to 24 months of minimum bills, based on the customer’s planned post-ramp peak demand ^[1]. Staff would also replace a clause letting Duke negotiate “non-material” terms without commission review, a phrase the tariff never defined, with the narrower administrative language of Section 366.05(1)(e) ^[1].

Two existing customers already exceed 50 MW; Duke’s witness said he believed both have been on the system for at least 20 years. Staff would keep them grandfathered, but only for their existing load ^[1].

Where the sides stand

Duke’s argument at the August 25 hearing was that the tariff could not raise anyone’s rates in the near term. Duke attorney Dianne Triplett said base rates are frozen, that the utility is “unlikely to incur significant large load costs during the settlement period,” and that shareholders would bear any that arise ^[6]. Duke’s witness Steve Wishart of Concentric Energy Advisors testified that Florida is “not currently a top-tier market for data centers” ^[6].

Public Counsel Walt Trierweiler said the filing “doesn’t attempt to comply with the most basic provisions of SB 484” ^[6]. Bradley Marshall of Earthjustice, representing Florida Rising, argued that if the data center build-out turns out to be a bubble, other customers “will be left holding the bag for billions and billions of dollars of infrastructure” ^[6].

Large industrial customers backed Duke. The Florida Industrial Power Users Group, Nucor Steel Florida and PCS Phosphate filed a joint brief asking for approval as filed ^[1]. FIPUG’s attorney John Moyle cautioned against getting “caught up in a rush to do something about data centers” ^[6]. None of the three is a data center. A threshold written as 50 MW at one location reaches steel mills and phosphate plants too, which is why they were in the room.

The public showed up in the docket: more than 4,400 consumer comments by October 20 ^[1]. After the vote, Commissioner Gabriella Passidomo Smith said the law “made it clear that large load customers must bear their own full cost of service without shifting those costs to other ratepayers,” adding that Duke can still serve large data centers within it ^[4].

What I’m watching

First, December 22, the eight-month effective date the staff recommendation lists for Duke’s docket ^[1]. The written order should set the refiling terms before then.

Second, Florida Power & Light. On October 1 it filed Docket No. 20260149-EI, asking the commission to approve revisions to its large-load tariff and to find its existing Large Load Contract Service tariffs, as revised, compliant with the same statute ^[2]. The prehearing conference is April 20, 2027, and the hearing is set for May 4-7 ^[2]. FPL will face the two-part test Duke just failed.

Duke wanted to settle the contract now and the rate in 2028. The open question is what a 50 MW customer in Duke’s territory pays in between.