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Critics hail 'modest' reforms to nuclear advance fee law

Duke Energy will have to demonstrate that it plans to build a nuclear plant if it wants to continue collecting the fee from customers. Duke is permanently closing the crippled Crystal River nuclear plant that has been shut down since late 2009. The damaged containment building of the nuclear plant is seen at the center of the photo.

MAURICE RIVENBARK | Times

Duke Energy will have to demonstrate that it plans to build a nuclear plant if it wants to continue collecting the fee from customers. Duke is permanently closing the crippled Crystal River nuclear plant that has been shut down since late 2009. The damaged containment building of the nuclear plant is seen at the center of the photo.

Gov. Rick Scott has signed the bill that toughens guidelines for utilities that want to collect money from customers in advance for construction of new nuclear plants.

Critics of the nuclear advance fee hailed the governor's move as a critical step toward guarding consumers' money. The advance fee has allowed utilities to collect hundreds of millions of dollars for nuclear plants that may never be built.

Neither Florida Power & Light Co. nor Duke Energy have committed to building the reactors for which they have been collecting money since as far back as 2009.

"We welcome the governor's signature on this modest bill, which is an important step in reigning in unbridled utility access to consumers' wallets," Stephen Smith, executive director of the Southern Alliance for Clean Energy, a nonprofit environmental group, said in statement.

"We remain concerned, however, that the Governor's appointments to the Public Service Commission continue to be captive agents of the large power companies in Florida," Smith said. "This bill will not work if the Public Service Commission does not work."

Sen. John Legg, R-Lutz who sponsored the legislation signed by the governor late Friday, agreed with Smith's view that the legislation did not go far enough.

"More work needs to be done in reforming the system, particularly the Public Service Commission and how we go about providing the long-term energy needs of our state," Legg said. "Unfortunately, a total repeal wasn't achieved and a refund wasn't achieved."

The PSC defended its handling of the nuclear advance fee law based on the way the legislation was crafted.

"On May 2, the Supreme Court of Florida unanimously upheld that Florida's Public Service Commission correctly implemented Florida's Nuclear Cost Recovery law in a case brought forth by the Southern Alliance for Clean Energy," Cindy Muir, a spokeswoman for the PSC, said in a statement. "Florida's PSC will continue to implement the laws in the public interest as established by Florida's legislature."

The state's two largest utilities, Duke and FPL, propose to build two reactors each, but have not committed to do so. Still, the utilities have been collecting hundreds of millions of dollars from consumers in advance for the projects without any requirement to refund the money if the plants never get built.

Duke customers are paying $1.5 billion toward the Levy project, and the utility gets to pocket about $150 million, whether or not the plant gets built.

Duke is collecting $3.45 per 1,000 kilowatt hours of usage each month from its customers this year and will continue to do so through 2017, as approved in an agreement with the state.

The utility also spent hundreds of millions increasing the power at the now-shuttered Crystal River nuclear plant and still wants customers to foot the bill for the expenses, though they'll never get a kilowatt for it.

The legislation Scott signed into law states that if a utility cannot demonstrate that it plans to complete the construction of the nuclear plant, it will no longer be allowed to collect money. The utility has 10 years after it gets its license to begin construction or lose access to the fee.

And it must prove the plant is both economically "feasible" and "reasonable" to continue moving forward with the projects.

Ivan Penn can be reached at ipenn@tampabay.com or (727) 892-2332.

Critics hail 'modest' reforms to nuclear advance fee law 06/17/13 [Last modified: Tuesday, June 18, 2013 6:47am]
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