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ORDER NO. PSC -2018 -0103 -PCO -EI DOCKET NO. 20170272 -EI PAGE 5 Amended Imdementation Stioul 'KM Attachment A Page 1 of 2 1. The 2017 Second Revised and Restated Settlement Agreement ('Agreement") was approved by the Commission in Order No. PSC -2017 -0451 -AS -EU. As explained more fully 'below, the signatories to the Agreement enter into this Stipulation to implement spedficprovisions related to the timing of rate treatment of certain events contemplated in the Agreement that have become manifest (Le., storm restoration costs and federal tax reform). 2- Paragraph 38(c) of the Agreement grants Duke Energy Florida, LLC ('DEP) the right to recover, on an interim basis, storm damage costs sixty days after fling a petition with the Commission. Pursuant to this paragraph, on December 28, 2017, DEF fled for the recovery of $513 million esti mated for storm damage costs associated with Hurricanes Irma and Nate and replenishment of DEPS retail storm damage reserve to the level specified in the Agreement. To reduce rate impacts to customers, DEF proposed to recover this amount over three years, resulting in approximately $171 million of costs to be recovered from customers annually starting in"March 2018. The Commission has opened Docket No_ 20170272 -EI to consider DEPS request 3_ Paragraph 16 of the Agreement provides a mechanism for calculating and implementing the impact of tax reform on DEPS rates, which will inure to the benefit of customers on the effective date of tax reform changes On December 22, 2017, the President signed the Tax Cuts and Jobs Act ("Tax Act") into law. Part of the Tax Act includes a reduction in the corporate tax rate from 35 percent to 21 percent DEF, using the methodologies set forth in Paragraphs 16(b) and 16(c) of the Agreement, has preliminarily estimated the impact of the Tax Act to result in a reduction in revenue requirements of approximately $135 .million ,per year (after taking into account the $50 million actelerated depredation of Crystal River ('CR') Units 4 and Sias expressly provided in the Agreement). DEF and the other signatories to the Agreement agree that the $135 million estimated annual Tax Act revenue requirement impact is based on preluninary data and is subject to final true -up. As specified in the Agreement DEF is obligated to reduce customer base rates within 120 days of the December 22, 2017 enactment date, or by April 21, 2018, upon a thorough review of the effects of the Tax Act on base revenue requ'm±menns to account for the impacts of the Tax Act. Any final true -up associated with .further refinement of the estimate and recognition of the pre -implementation will be reflected in the amount recognised consistent with paragraph 5 below. 4. The storm damage costs are allocated to customer rate classes in the same manner as base rates. Absent this Implementation Stipulation, DEF would be authorized to increase rates by an average of $171 million per year starting in March 2018, and would subsequently reduce'base rates at it laterdate in 2018 by an estimated $135 million per year. The Signatory Parties seek to avoid this volatility in customer rates and agree that DEF should effectively utilize the annual Tax Act bereeiits to avoid implementing the charge to customers for storm damage costs that they would have otherwise been chlgated to .pay. To accomplish this goal, DEF shall, after Commission approval of the interim storm restoration recovery charge, withdraw the tariff sheets it filed with its December 28, 2017 filing. The parties request that the Commission consider this stipulation in conjunction with its approval of this interim charge. Because those tariff sheets also included the impact of the Ann Securiti¢ation Charge True -Up {Docket 44165