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Duke Energy seeks proposals to build new natural gas plant

Duke Energy plans to issue a request for proposals Oct. 8 for construction of a new natural gas plant in Citrus County to replace the power lost by its shuttered nuclear facility.

Proposals will compete with Duke Energy's option of building the new plant itself. The plant will be a highly efficient, combined-cycle, natural gas unit with 1,640 megawatts of capacity starting operation in 2018.

"We have a need for significant generating capacity in 2018, and through the RFP (request for proposals) process, we will be able to identify the most cost-effective, safe and reliable generation source for our customers," said Alex Glenn, Duke Energy's Florida president.

Florida Power & Light, the state's largest utility, recently completed one of three new combined-cycle natural gas plants it is building. Those units, though slightly smaller than Duke's proposed facility, range in cost from $970 million to about $1.5 billion.

Duke has scheduled an RFP pre-release meeting for Oct. 2, and a meeting for interested bidders for Oct. 18 at the Tampa Marriott Westshore.

After screenings and evaluations, Duke expects to announce a short list of proposals in March, followed by the naming of finalists two months later.

The RFP award is expected in August.

The decision to build the natural gas plant in Citrus County means at least some jobs will return to a community that lost hundreds with the closing of the Crystal River nuclear plant.

Duke announced in February that it would not seek to repair the plant, damaged during an upgrade and maintenance project in 2009.

The shuttered plant became part of the focus of a property tax dispute between Duke and Citrus County over the last year. Duke paid just $19 million of a $36 million tax bill. Duke said its tax bill should be lower with the closing of the plant.

Citrus responded this year with a comprehensive property review and determined that Duke failed to report or underreported assets. The utility's bill this year is $63 million.

Although Duke closed the nuclear plant, the utility still operates four coal plants and owns transmission lines and other property in Citrus County.

Sterling Ivey, a Duke spokesman, said the company was collecting and reviewing its tax notices but "generally believe the appraiser's assessment overstates the value of our property at the Crystal River Energy Complex."

"Duke Energy has fairly and accurately reported all of its property in Citrus County," Ivey said. "We continue to review the property appraiser's independent appraisal as well as complete the work of our own independent analysis for the 2013 tax year. At this time, we anticipate our good-faith payment to be consistent with our 2012 payment of approximately $19 million."

Geoffrey Greene, the Citrus property appraiser, said he sent out tax rolls Tuesday and had not heard from Duke about the new bill. He hopes Duke's decision to build the natural gas plant in Citrus is a sign that the utility and the county can resolve their differences and move forward.

"I think it's wonderful news for Citrus County," Greene said of the new natural gas plant. "We certainly want to continue working with … Duke. Hopefully, we can get together and work out our differences."

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

Duke Energy seeks proposals to build new natural gas plant 09/24/13 [Last modified: Wednesday, September 25, 2013 1:56am]
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