FPL’s Rates Are Below Average; Their Profits Are Not

Executive Summary: A March 2026 report from the Energy and Policy Institute found that Florida Power & Light earned the highest profit margin of any investor-owned utility in the country in 2025 — 27.44 cents of profit on every dollar collected. The national average was around 12.8%. FPL’s rates are genuinely below the national average, and that deserves credit. But FPL’s customers would likely be paying even less if Florida regulators pushed harder on the profit side of the equation. This post breaks down what the data shows, who the sources are, where their biases lie, and what the rate case fight of 2025 actually revealed about how FPL’s profits are set and protected. For Southwest Florida homeowners weighing solar or battery backup, the numbers here are the real context behind your return on investment.

The Most Profitable Utility in the Country Serves Your Home

FPL wants you focused on one number: your monthly bill compared to the national average. And they have a point. FPL’s typical 1,000 kWh residential bill was $134.14 heading into 2026, and the company accurately notes that it is well below the national average. If you were paying California or New England rates, you would be in real pain. Florida is not a cheap electricity state by accident. FPL has invested heavily in nuclear generation, solar, and grid modernization, and those investments keep fuel costs relatively stable.

I give them that. Now here is the part they do not lead with.

A March 2026 analysis by the Energy and Policy Institute (EPI) examined audited SEC financial filings from 110 investor-owned utilities nationwide. FPL ranked first in the country for profit margin in 2025 at 27.44%, and second nationally from 2021 to 2024 with an average margin of 23.51%. The industry average across all utilities studied was 12.8%. FPL nearly doubled it.

On a $200 monthly FPL bill, roughly $54 is profit. Not grid infrastructure. Not storm restoration. Not power generation. Profit flowing to NextEra Energy shareholders.

What the EPI Report Actually Measured, and How to Read It

Before you take any single data source at face value in an energy policy fight, you need to know who wrote it and why. So let me be direct about the sourcing here.

The Energy and Policy Institute is a consumer and clean energy advocacy organization. Their stated mission is to expose utility industry influence campaigns and push for clean energy policy. They are not a neutral research institution. Their reports are designed to support policy arguments, not just describe data. That is worth knowing.

What they did have is solid underlying data. EPI pulled their figures from SEC 10-K annual reports — the same audited financial statements FPL files with federal regulators. Where 10-K data was unavailable, they used FERC Form 1 filings, which are equally structured and mandatory. The metric itself is simple: net income divided by total revenue. You can pull FPL’s 10-K yourself and run the same calculation. The math is not contested.

What EPI’s advocacy orientation does shape is emphasis and framing. The report argues these margins are excessive and that regulatory reform is needed. Those are policy positions. Whether you agree with their prescriptions, the underlying financial data is what it is.

The other sources in this story carry their own biases. AARP Florida opposed the rate hike because it puts pressure on fixed-income older adults, an entirely legitimate concern, but they are advocates for a specific constituency. Food & Water Watch is a progressive environmental organization that opposed the rate hike; their framing tends toward the most alarming available number. FPL’s own press releases are corporate communications, not consumer reporting. The Office of Public Counsel is the closest thing to a neutral party; they are Florida’s legislatively-designated consumer advocate in rate proceedings, and their analysis consistently showed FPL’s request was too high.

The most straightforward reporting I found came from investigative journalist Jason Garcia, whose Substack newsletter Seeking Rents covered the rate case in granular detail. Garcia noted that a single percentage point increase in FPL’s allowed return on equity equals roughly $500 million extracted from customers. That framing captures the real stakes of ROE debates more clearly than either the utility’s or the advocates’ talking points.

The Rate Case: What Actually Happened in 2025

The profit margin debate is not academic. It played out in real time through a rate fight that consumed most of 2025 and ended with a result that consumer advocates are taking to the Florida Supreme Court.

In February 2025, FPL petitioned the Public Service Commission for a four-year rate increase. Critics described it as the largest utility rate hike in American history, originally totaling around $9.8 billion over four years. At the center of the request was a proposed return on equity of 11.9%, compared to a national average of around 9.6%.

A key provision of the settlement talks is worth understanding: FPL halted the formal rate case midway through, negotiated a revised deal in private with a group that included Walmart, Wawa, RaceTrac, and various Florida business associations, and then presented that settlement to the PSC. The Office of Public Counsel, the state’s legally designated consumer representative, was not in the room when the deal was negotiated. The OPC then submitted their own alternative proposal, which the PSC chairman rejected as inadmissible as a settlement.

In November 2025, the PSC voted unanimously to approve the revised settlement at approximately $6.9 billion. The approved return on equity was set at 10.95%, a reduction from the original 11.9% ask, but still the highest approved ROE in the lower 48 states, and well above the national average of 9.6%.

Commissioner Gabriela Passidomo Smith called the ROE the “big kahuna” and said on the record that she did not love it. Then voted for it anyway. Three other commissioners expressed similar reservations. All five voted yes.

AARP Florida, the OPC, and multiple consumer groups are challenging the settlement. Attorneys representing consumer groups said publicly that they expect the case to end up before the Florida Supreme Court.

Meanwhile, a Florida Senate bill sponsored by Republican Sen. Don Gaetz that would have reined in utility profits died after lobbying by Florida Power & Light. Gaetz said publicly that FPL’s lobbying killed the measure. The irony of a utility simultaneously fighting a profit-limiting bill in Tallahassee while asking the PSC for the highest ROE in the lower 48 states is not subtle.

FPL Fights Rooftop Solar While Asking for Record Profits

Here is where I have a direct stake in this story, so I will be transparent about it. I install solar and battery systems in Lee, Charlotte, and Collier Counties. FPL is most of my customers’ utility. And FPL has consistently lobbied against the residential solar policies that would most benefit those customers.

While FPL publicly frames itself as a solar leader, pointing to its utility-scale solar buildout as evidence of clean energy commitment, it has pushed against net metering reforms and rooftop solar policies at the legislative level for years. Watchdog reporting noted that FPL was simultaneously telling the PSC it needed billions to meet demand growth while fighting tooth and nail against consumer rooftop solar in Tallahassee.

The reason is not complicated. Every kilowatt-hour a customer generates themselves is a kilowatt-hour FPL does not collect revenue on. A utility earning a 27% profit margin has a structural financial incentive to keep customers dependent on the grid. That is not a conspiracy theory. It is basic financial math.

FPL’s net metering program currently offers true 1:1 credit, exported solar power is credited against consumption at the same rate. That is a genuine benefit, and I do not want to be dismissive of it. But the regulatory picture around net metering is not static, and a utility with the lobbying resources FPL deploys is not a passive player in determining what those rules look like over time.

The Real Math Behind Southwest Florida Solar Economics

I model solar systems for homeowners across Southwest Florida. When I build a financial analysis for a client, I am modeling their savings against a baseline FPL bill. That bill now includes a profit layer running at nearly 27 cents per dollar.

The federal residential solar tax credit is not available for 2026 buyers. That changed the investment calculus for some homeowners. But the fundamental driver of solar payback in this market is the cost of grid electricity, and with FPL’s approved ROE now locked in as the highest in the lower 48 states through 2029, with incremental rate increases already approved, that cost is not going down.

Every kilowatt-hour your solar system produces is a kilowatt-hour you did not buy at a rate that includes the most profitable utility margin in the country. Add a battery system and you are managing not just generation but consumption, controlling when you draw from the grid, minimizing what you send to a utility that has now locked in elevated profit levels through the end of the decade.

That context matters when you are evaluating whether a solar or battery investment makes sense for your home. The grid is not a neutral commodity. It is a product sold by a regulated monopoly that, by the data, has consistently captured a larger share of every customer dollar as profit than almost any comparable utility in the country.

What “Below the National Average” Actually Means

FPL will tell you, correctly, that their typical residential bill will remain well below the national average through the end of the decade under the new rate agreement. That is a real and meaningful fact. Southwest Florida homeowners are not being crushed the way Massachusetts or California customers are.

But “below average” is not the same as “as low as it could be.” The Office of Public Counsel’s alternative proposal — which the PSC never got to vote on as a settlement — would have cut rates in 2026 rather than raising them, while still delivering a comfortable return on equity to FPL. The OPC is not a radical consumer advocacy group. They are the legislatively appointed representative of Florida utility customers, staffed with regulatory economists. Their analysis concluded that FPL’s rate base could support a lower ROE and still fund the infrastructure investment FPL claims it needs.

AARP noted that the Florida average residential electricity usage is 1,743 kWh per month — nearly double the 1,000 kWh benchmark FPL uses in its press releases. At actual Florida usage levels, real bill impacts are substantially larger than the $2.50 monthly figure FPL publicized after the settlement.

Disclosing source bias cuts both ways. Advocacy organizations like Food & Water Watch and AARP are arguing for their constituencies. EPI is arguing for clean energy policy. But FPL’s own communications are equally advocacy. When you see FPL say their rates are “well below the national average,” they are technically correct and strategically selective. The comparison they do not make is: what would rates look like if the PSC had held FPL’s ROE to the national average of 9.6% instead of approving 10.95%?

Jason Garcia’s reporting provides the answer framework: each percentage point of ROE is worth approximately $500 million to shareholders — and that same $500 million comes directly out of customer bills.

The Bottom Line

FPL runs a well-managed, reliable utility. Florida electricity bills are lower than most of the country, and some of that is genuinely due to FPL’s operational investments. Those things are true.

Also true: FPL has been the most profitable investor-owned utility in the country by margin, earned that distinction while the PSC was approving what critics call the largest rate hike in U.S. history, lobbied to kill legislation that would have capped those profits, and negotiated its settlement terms in private with business groups while excluding the state’s consumer advocate. The PSC approved an ROE that multiple commissioners said they did not love but voted for anyway. That case is now headed toward the Florida Supreme Court.

For Southwest Florida homeowners, the takeaway is simple. Your FPL bill is not a neutral cost of service. It is a regulated price set by a process heavily influenced by the most capitalized party in the room. “Below average” is not the same as “fair.” And every dollar your solar system generates is a dollar that does not flow to a company currently posting the highest profit margin of any utility in the lower 48 states.