Should Exec Pay Impact Consumer Bills?

AP reported this week that before regulators will consider raising rates for Florida Power & Light (FPL) and Progress Energy in January, they want a look at the books---not the fuel costs or bills for upgrades and new technology. No. Specifically, they want to know who gets paid over $165K a year and why.

A sweeping unanimous vote by the Public Service Commission, they've gone on the record saying that such information is vital to their analysis. FPL wants $1.3 billion, Progress Energy $500 million. The Public Service Commission wants details.

Legal reps for Progress claim that revealing that info will raise costs and lower productivity. They expanded on that statement to say that showing their hand on employee compensation would also create poor employee morale and increase employee turnover. (No, they never actually explained how all those dots connected, exactly.)

According to public records reported on by AP, FPL has 463 employees that jump that 165K bar; Progress Energy has 132.

It seems obvious, doesn't it? The Commission is thinking that, perhaps, instead of raising rates on an over-taxed, recession-exhausted end-user, the utilities should consider compensation evaluations, reductions or layoffs.

My stepfather used to say that no one, anywhere, could ever work hard enough to "morally earn" more than 100K a year. Any more than that, and there was, obviously, a little gouging going on somewhere, in his view. (Of course, he worked outside in the heat, in the cold, under old homes, in the dirt, and never made more than 25K. So, he probably would feel very little empathy for an executive making "the big bucks," as he'd label them.)

But, do they earn the big bucks? Now, the utilities might argue that some of those people---nuclear engineers, for example---have unique skills and that high compensation is the cost of keeping them around, making sure they don't jump ship to another employer willing to pay them what they are worth.

But I think the average joe at the receiving end of an FPL or Progress electric bill would be surprised to learn that anyone working at their electric company makes $165K a year, let alone over 100 (with Progress) or almost 500 (with FPL).

So, does the Commission have a point? They might be approaching it on the subtle side right now, but the question lingers: Do utilities have a right to go out and ask for consumers to pay more without first examining expenses in house?