Big energy’s campaign cash keeps solar down in Florida

The reason Florida’s solar power industry isn’t a growing, say some lawmakers, is that the state’s largest utilities have invested heavily in state political campaigns to fend off competition.
The reason Florida’s solar power industry isn’t a growing, say some lawmakers, is that the state’s largest utilities have invested heavily in state political campaigns to fend off competition. AP

Back when Paige Kreegel was a state representative in 2009, he had an idea that he thought simply made sense. Florida, the Sunshine State, should become a model for solar power.

As chairman of the state House’s Committee on Energy, Kreegel was in a position to change Florida laws that have restricted the growth of rooftop solar panels. As a self-described free-market Republican, he wanted to get government out of the way of a growing industry.

But Kreegel soon discovered his fellow committee members wouldn’t discuss solar energy, and the fact that he brought it up made him an outcast. When he walked the halls of the Legislature, other lawmakers would shut their doors.

“You know how Tallahassee has an in-group and an out-group?” said Kreegel, a physician in Punta Gorda who left the House in 2012. “I didn’t know I was on the outside until I went against the public utilities, and then — holy hell.”

Kreegel isn’t alone. Other lawmakers and lobbyists say that anyone who has attempted to expand the rooftop solar industry has been ostracized. The reason, some lawmakers say, is that Florida’s largest utilities have invested heavily in state political campaigns to fend off competition.

Campaign records show utility companies have sunk $12 million into the campaigns of state lawmakers since 2010.

That money comes from the bills paid by customers of the state’s four largest utilities — Duke Energy, Gulf Power, Florida Power & Light and Tampa Electric.

Those donations include contributions to every member of the Senate and House leadership. The recipient of the most utility money since 2010 is Gov. Rick Scott’s 2014 reelection campaign, which took in more than $1.1 million through two political action committees.

“Why don’t we have a bigger solar industry in Florida?” asked Mike Antheil, a West Palm Beach lobbyist who represents solar companies. “The answer is simple. Every kilowatt of solar you produce on your roof is one less kilowatt that the utilities can sell you.”

The state’s largest utilities declined to comment on specific questions related to this article.

In an email, Duke Energy spokesperson Sterling Ivey said the company could not comment “since there is pending/proposed legislative bills that we are actively monitoring.”

Cherie Jacobs, Tampa Electric spokeswoman, said: “We participate in the political process, we support both parties, and we support candidates who focus on building the economy and on creating jobs.”

FPL spokeswoman Alys Daly wrote in an email that the company supports “customers who want to install their own solar panels, and we take special care to serve the specialized needs of our solar customers.”

With little support in Tallahassee, a coalition of conservative and liberal groups hopes to make Florida friendlier to rooftop solar energy with a 2016 ballot initiative. Before that happens, though, Florida’s four largest power companies may see their influence grow. Proposed legislation in Tallahassee would stop homeowners from selling extra energy created from solar back to utility companies, perhaps the biggest blow yet to Florida’s fledgling solar industry.

Parties and PACs

Only a small portion of the $12 million spent since 2010 by electric companies on campaigns went directly to candidates. Most went to political action committees and political parties.

Half of the money, $6.68 million, went to the Republican Party of Florida. The second-largest recipient, the Florida Democratic Party, took in $1.8 million.

Donations of this type allow the utilities to avoid contribution limits, which cap donations to legislative candidates at $1,000 per election cycle.

Conservative political action committees top the list of those receiving contributions, with the Florida Conservative Majority, Freedom First Committee and House Republican Campaign Committee all receiving more than six figures each from utilities.

Among the politicians who have received utility money, Scott tops the list. The utilities gave $15,444 directly to Scott’s campaign fund. They also gave $600,000 to Scott’s Let Get to Work PAC. The utilities handed another $670,000 to the RGA Florida PAC, which in turn gave $500,000 to the Let’s Get to Work PAC. That puts electric company contributions to Scott, directly and indirectly, at $1.1 million.

In the Legislature, all 16 state senators and representatives who make up the leadership have received utility money. In total, they have pulled in more than $200,000 from utilities and their interest groups.

Those donations allow the power companies to keep pro-solar bills from getting anywhere, said state Rep. Dwight Dudley, D-St. Petersburg, a supporter of the rooftop solar industry.

“We in Florida are stuck in the stone age. This is probably the most Byzantine energy legislation in the country,” Dudley said.

He has filed legislation that would have increased renewable energy in the state, but none of his ideas made it to the House floor.

Taking on the utilities has made him an outcast, Dudley said. He was talking with an acquaintance at an event last year in St. Petersburg when a utility lobbyist walked up and said, “Oh my gosh, do you know who this is? The devil’s holy man,” Dudley recalled. “It was loud and unpleasant, and it became very uncomfortable.”

As for Kreegel, the former state representative initially had support from the utilities. That’s because he opposed mandates that required a percentage of the state’s energy come from renewable power, including solar.

But he lost that support when he worked to remove restrictions on rooftop solar, which Kreegel says is a big reason he’s now out of politics. In 2012, Kreegel ran in the Republican primary for the U.S. House seat in Fort Myers vacated by Republican Trey Radel, who resigned after being arrested for attempting to purchase cocaine from an undercover police officer. Supporting solar back in 2009 caused him to be labeled a nonconformist, Kreegel said, and he didn’t get the support of the Republican Party. He finished third.

“The whole point was that government shouldn’t be impeding in good business,” Kreegel said of his support for solar. “But I learned you don’t go against the utilities.”

Longtime monopoly

The Florida law that restricted the growth of the rooftop solar industry has been on the books for nearly a century. It was written to give utilities a regional monopoly on power production, avoiding a tangle of power lines strung up by competing companies.

The law didn’t affect the solar industry until the past several years, when the price of solar panels made it cost-efficient for rooftop solar to compete with utility companies. With ample sunshine, only two other states, California and Texas, have more rooftop solar power potential than Florida, according to the U.S. Department of Energy. Yet the state ranks 13th in installed solar capacity.

The average home solar array now costs $15,000 to $30,000 and can pay for itself in 10 to 20 years, said Ray Johnson, president and founder of the U.S. Solar Institute, an Oakland Park school that teaches technicians how to install the panels.

The problem is that few homeowners want to pay up front for the system, Johnson said. In about half of the states, solar companies can install panels for free and then sell the power to the home or business owner at a rate lower than utilities, paying for the system over time. These third-party sales are generally illegal under the Florida law that gives utility companies a local monopoly on supplying power.

Since Kreegel’s unsuccessful attempt to expand solar in 2009, other lawmakers have watched their bills languish in committee.

State Sen. Jeff Brandes, R-St. Petersburg, submitted a bill last year that would have given a tax break to businesses and homeowners who installed solar. The law would have meant the property tax value of the home or business could not increase as a result of the value of the solar panels. His bill never received a hearing in Senate committees.

This year, Brandes has filed a new bill that would allow businesses that produce extra energy from solar cells to sell that energy to neighbors, but it faces an uphill climb in the Legislature.

“Here’s how the power companies control the Legislature: They ask the chairman of committees to never meet on the issue,” Brandes said.

Beyond Legislature

With few allies in Tallahassee, the state’s rooftop solar power industry is now looking to bypass lawmakers. A proposed constitutional amendment, which may appear on the 2016 ballot, would allow third-party solar power sales in Florida.

The effort is being organized by an unlikely collection of interests, including the Christian Coalition, pro-retail groups, the tea party and clean energy supporters. The idea brings together those who support fewer government regulations and those who support reducing carbon emissions, said Tory Perfetti, a Republican operative from Tampa working with a group called Floridians for Solar Choice.

“Finally, the sun is shining on the process of opening the energy market in Florida,” Perfetti said.

The ballot initiative is being funded in part by Floridians for Solar Choice, a political action committee. It’s not easy to trace the source of the money being given to the pro-solar initiative. Most of the contributions to Floridians for Solar Choice, totaling $264,457, came from the Southern Alliance for Clean Energy Action Fund, which does not report the source of its money.

George Cavros, a Fort Lauderdale lawyer who works for the alliance, said the group will not reveal the source of the money to protect “the privacy wishes of individual donors.”

The Southern Alliance for Clean Energy has claimed in filings with the Federal Elections Commission that it “does not participate or intervene in any political campaign” and does not need to report its funding sources. It’s a position that has earned the group criticism for its use of “dark money” spending.

The rooftop solar industry typically gets money from venture capitalists, private equity firms and large solar installers. In the last quarter of 2014, investors sunk $9.8 billion into the growing solar industry, according to a report from Mercom Capital Group.

Even with the money the ballot initiative has raised, it faces some formidable opponents. Cavros said he knows the state’s utilities will likely sink money into a campaign to fight it. A conservative group backed with money from big oil companies has already campaigned against it. Americans for Prosperity, funded in part by the Koch brothers, sent an email to supporters claiming the ballot initiative is “about money, and using government and taxpayers to prop up the solar industry.”

Editor’s Note: An earlier version of this story incorrectly identified the political affiliation of state Rep. Dwight Dudley of St. Petersburg. He is a Democrat. And to clarify another part of the same story, the legislation that would stop homeowners from selling extra energy created from solar back to utility companies is being promoted in Tallahassee by the American Legislative Exchange Council. It has not yet been sponsored by a member of the Florida Legislature.

Also, Rob Gould, Florida Power & Light & Light vice president of communications, sent a memo on April 7 to newspaper editors and publishers throughout the state, saying that FCIR’s story was “riddled with factual errors and misleading claims.”

Click here to read FPL’s memo and the FCIR response to FPL.

Grant Smith of the Florida Center for Investigative Reporting contributed data analysis to this report.

The Florida Center for Investigative Reporting is a nonprofit news organization supported by foundations and individual contributions. For information, go to fcir.org.