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PSC staffer removed from TECO coal case

The Public Service Commission said TECO didn't influence the removal of a critic of the coal-transport plan.

By LOUIS HAU
Published May 27, 2004

TALLAHASSEE - A Florida Public Service Commission staff member who had criticized Tampa Electric Co.'s controversial coal-transport contract with a fellow TECO Energy Inc. subsidiary has been removed from further deliberations into the case.

The removal of electric utilities specialist William McNulty has riled critics of the transport contract. They questioned the timing of the decision and noted that it followed the release earlier this month of a PSC staff opinion, with input from McNulty, that rejected Tampa Electric's defense of its new five-year contract with TECO Transport.

TECO had sought McNulty's removal, marking at least the second time the Tampa utility had singled out the PSC staff member, who is a public utilities supervisor in the PSC's division of economic regulation.

The first time TECO targeted McNulty, it took the unusual step in early April of calling him in to provide a day and a half of sworn testimony about how he reached his conclusions about the contract, who he had been in contact with and even whether he had been swayed by "outside influences" such as other transport companies. Although utilities are allowed to take depositions from PSC staff members involved in cases before the commission, they rarely do so.

Today, the PSC begins two days of public hearings on the contract.

McNulty declined to comment, referring all questions to the PSC's public relations office.

PSC general counsel Richard Melson recommended McNulty's removal from the case to avoid the appearance that the PSC staff is "prejudging" the matter before it issues a formal recommendation next month, commission spokesman Tarik Noriega said.

The concern grew out of testimony in late March from an economic consultant testifying on behalf of the state Office of Public Counsel and the Florida Industrial Power Users Group, both of which oppose the TECO Transport contract. The witness cited observations made by McNulty last fall that were critical of the rates Tampa Electric had agreed to pay TECO Transport.

"Because McNulty filed testimony and then it was relied on by other intervenors, it put him in a predicament," Tampa Electric spokesman Ross Bannister said.

Noriega said McNulty's removal was "not a matter of any party expressing a concern. ... There was an internal decision not influenced by any party."

But Bannister acknowledged that the utility had asked the PSC staff to take McNulty off the case.

"Over the last couple of weeks, our attorneys have had an ongoing conversation with the legal staff over there and the result of those conversations is recognition ... that it probably serves everyone's interests that McNulty be off the docket," Bannister said.

Public counsel Harold McLean, whose office represents Florida utility consumers before the PSC, said the filing containing McNulty's earlier observations about the transport contract was never entered into the official record of the PSC's deliberations. As a result, McLean argued, there is no legal basis to bar him from the case.

"I can damn sure tell you that McNulty isn't disqualified because of what public counsel's witness said," McLean said.

However, he said, "if they want to avoid the appearance of impropriety, they can draw the line wherever they want to."

McLean, who had been PSC general counsel, called McNulty as "an extremely unbiased, competent staff witness. ... I'm disappointed that the case will lose his level of expertise and experience."

McNulty's removal comes after he helped prepare a prehearing statement May 10 that criticized Tampa Electric's choice of TECO Transport to ship coal down the Mississippi River and across the Gulf of Mexico to its coal-fired power plants in the Tampa Bay area.

The PSC staff, the public counsel's office, competing transport companies and other consumer advocates have come out against the contract, arguing that Tampa Electric's search for the lowest-cost provider was inadequate. Tampa Electric has countered that it is paying TECO Transport competitive rates and it should be permitted to charge its customers to cover those rates.

- Staff writer Louis Hau can be reached at hau@sptimes.com or 813 226-3404.

[Last modified May 27, 2004, 01:00:38]

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