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Florida utilities pressed for answers on escalating costs, time lines for new nuclear power plants

TALLAHASSEE — For the past two years, customers of Florida's largest electric companies have been paying to build new nuclear power plants that have an escalating price tag and no guarantee of completion.

Attorneys for consumers and the state's largest electricity users told the Public Service Commission on Monday to demand answers from the utilities.

What they want to know: When will we see the power plants promised by Progress Energy Florida and Florida Power & Light as the lowest-cost way to meet Florida's future energy needs? How much will they cost customers? And will regulators make sure that the electric companies have skin in the game when their costs climb, such as prohibiting them from passing on cost overruns to customers?

"Progress Energy has spent $1 billion and gotten not much more than a large tract of land and a license,'' said Charles Rehwinkel, associate public counsel, who represents the public in cases before the PSC.

Commissioner Ron Brise said he will ask the full commission to address those issues when the PSC convenes nearly two weeks of hearings for FPL and Progress Energy later this month. He refused, however, to require the utilities to answer the question of whether the costs and time lines are reasonable.

The Legislature gave the PSC the authority to decide how much to charge customers for new nuclear power as part of its 2008 energy bill. It was a tradeoff to the utility companies in exchange for strict new rules intended to encourage the development of renewable energy and energy conservation, and wean the state off its dependence on fossil fuels.

Although legislators have never followed through on the renewable energy standards, and the PSC last week all but ignored the energy conservation improvements, the nuclear power provision remains.

Progress Energy has been allowed to charge customers $6.64 a month for every 1200 kilowatt hours of electricity. The money will go toward a new nuclear plant in Levy County, set to be completed in 2020, and for a project that will expand the nuclear capacity at its Crystal River plant. That project has been delayed until at least 2014.

FPL has charged customers much less, about 53 cents a month for 1200 kilowatt hours, and spent about $319 million for new nuclear capacity at its Turkey Point Units 6 and 7. Next year the company wants to spend $183 million. The total cost is estimated at between $18 billion and $22 billion and would be completed between 2022 and 2023.

FPL disagrees that it should be required to provide precise price tags and dates, arguing that it is following the requirements set forth by the Legislature. The company told Brise at the Monday hearing that the long-term cost of building the plants will offset the cost to consumers, who now must pay more for natural gas and other fossil fuels.

The Office of Public Counsel also wants the PSC to impose stronger standards on how FPL calculates its costs. It said that the cost of expanding its nuclear capacity at its Turkey Point plant has escalated from $1.4 billion to $1.8 billion in the last year, but the company makes the project appear more cost-effective by not including what it has already spent on the project.

Mary Ellen Klas can be reached at [email protected]

Florida utilities pressed for answers on escalating costs, time lines for new nuclear power plants 08/01/11 [Last modified: Monday, August 1, 2011 9:00pm]
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