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$54 million consumer refund sought for Duke's canceled nuclear project

Consumer advocates want Duke Energy Florida to refund $54 million the utility collected from customers for nuclear equipment that was never purchased.

The advocates asked state regulators Monday to order Duke to give a credit in this year's bills for equipment the utility sought for the now canceled Levy County nuclear project.

Duke paid the money to its then-contractor Westinghouse Electric Co., but the equipment was never purchased.

Duke is now suing Westinghouse in federal court in North Carolina to reclaim that money. But the utility has not agreed with consumer advocates that the money should be repaid before a judge's decision. Westinghouse is counter-suing Duke for $512 million for canceling the contract for the nuclear project.

If Duke loses the case, customers could be on the hook for at least part if not all of Westinghouse's claim.

Charles Rehwinkel, deputy state public counsel, who represents consumers before the Public Service Commission, called the potential loss to Westinghouse a "looming storm" that regulators needed to help guard customers against.

"Do right by the customers," Rehwinkel pleaded with the commission.

Duke announced plans to cancel the two-reactor, $24.7 billion project last year in part because of licensing delays by federal regulators and after reports in the Tampa Bay Times showed it would be more cost effective to build a natural gas facility.

By that time, the utility had already spent $1.5 billion on Levy plant siting, planning, engineering, parts, financing costs and its own profit — expenses state regulators passed on to Duke's Florida customers in settlement agreements over the last two years. The average customer is paying $3.45 a month in their bills through early 2016 to cover the Levy expenses.

Thomas Foster, Duke's director of rates and regulator planning, acknowledged during questioning at Monday's hearing that customers will have paid off the $54 million by the end of this year.

"The right remedy is for this commission is to record the credit and make the customers whole," Robert "Schef" Wright, who represents Florida retailers, told the hearing. "This will send an important message to Westinghouse and Duke that you will not tolerate any more costs being imposed for work that isn't done."

The commission will review the testimony and likely make a decision this fall.

Contact Ivan Penn at ipenn@tampabay.com or (727) 892-2332. Follow @Consumers_Edge.

$54 million consumer refund sought for Duke's canceled nuclear project 08/04/14 [Last modified: Monday, August 4, 2014 7:02pm]
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