Case Study:

Florida Public Utilities Rate Case

Florida Public Utilities Company | May 2022

Florida Public Utilities Company (FPUC) engaged Atrium to support rate case filing before the Florida Public Service Commission (FPSC), including the development of expert testimony, an embedded cost of service study (COSS), billing determinant forecasts, and a comprehensive redesign of the Company’s rate structure. The engagement included consolidating 54 legacy rate classes across four service territories and base rate increase request across a diverse customer base. Atrium’s work focused on aligning rates with cost-of-service principles, minimizing customer bill impacts, and preparing Minimum Filing Requirement schedules consistent with FPSC standards. 

CHALLENGE

FPUC’s 2022 rate case presented a uniquely complex challenge that extended far beyond a standard base rate increase. The proceeding required a comprehensive structural redesign of the Company’s rates—an unprecedented undertaking that demanded the integration of multiple legacy data systems and the development of a unified, enterprise-wide cost-of-service model. Atrium’s assignment involved balancing analytical precision with regulatory practicality: modernizing an overly fragmented rate structure while minimizing customer disruption. A purely cost-based approach would have produced severe bill volatility, including triple-digit increases for some classes, making careful calibration essential. 

Commission staff required extensive evidence to verify customer impact analyses and demonstrate that service quality and consumer protections would remain intact. To support this process, Atrium produced detailed bill impact analyses mapping customers from 54 legacy rate classes into consolidated ones and collaborated closely with FPUC to ensure the redesign aligned with regulatory expectations and public interest considerations. 

EXPERTISE

Atrium brought deep regulatory, analytical, and rate design expertise to every aspect of FPUC’s filing by developing a comprehensive suite of technical studies. 

Leveraging ten years of customer-level data, Atrium employed advanced time-series and regression models to project usage trends and customer growth by class and division, and service territories ensuring forecasts were both statistically robust and operationally credible. 

Building on this analytical foundation, Atrium led the rate design process—applying cost-based recovery principles, gradualism, and targeted mitigation strategies to balance fairness and affordability. Customer charges and volumetric rate blocks were tailored to reflect cost causation while minimizing rate shock. Extensive bill impact simulations informed the Company’s transition plan and guided decisions on full versus partial class consolidation. 

COSS were completed for each operating entity and then consolidated into a single, comprehensive analysis to ensure consistency and comparability across FPUC’s service territories. Atrium also prepared and supported all Minimum Filing Requirement (MFR) schedules and expert testimony, providing a transparent, data-driven foundation for regulatory review and evidentiary defense. 

OUTCOME

Atrium’s analytical rigor and testimony provided the foundation for a successful, data-driven resolution before the Florida Public Service Commission. The Commission approved a comprehensive consolidation of FPUC’s rate structure—reducing 54 legacy rate classes across four utilities to 16 unified classes—creating a consistent, modernized framework that enables FPUC to operate as a single, integrated utility under one name. 

In its order, the Commission recognized FPUC’s review of its rate structures as thorough and justified, acknowledging that the existing tariffs had become overly stratified and unnecessarily complex. Guided by Atrium’s analysis, FPUC developed a customer transition strategy centered on usage patterns and customer type. Residential customers were segmented into three distinct classes based on annual consumption to mitigate bill impacts and protect smaller users. For commercial and industrial customers, Atrium designed rate blocks and tailored structures to moderate increases while maintaining cost-reflective pricing. 

Commission staff agreed that the consolidated rate classes enhance clarity for customers and strengthen the utility’s administrative efficiency. The order also noted the absence of any opposing evidence from intervenors challenging the appropriateness of the consolidated structure. The result validated Atrium’s approach: a transparent, defensible, and customer-focused rate design aligned with cost-of-service principles and regulatory best practices.  

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