Progress Energy Florida customers can expect lower power bills starting in the next year.
The average customer, who uses about 1,000 kilowatt hours, would see a drop of $7.44, a result of lower fuel costs and a settlement agreement over the broken Crystal River nuclear plant.
That would lower the average bill for Progress Energy Florida's 1.6 million customers from the current $123.19 to about $115.75 a month.
The rate reduction would bring Progress' rates below the national average, which according to data from the Energy Information Administration stood at $119 a month in May.
"This is good news for the citizens of Florida, especially with the lingering effects of the recession," said J. R. Kelly, the state public counsel who represents consumers before the state Public Service Commission. "We're always happy when we're going to see customer rates come down."
The PSC still must approve the rate reduction, which would take effect Jan. 1.
Progress' rate reduction plan includes a $129 million refund to customers in 2013 as part of a settlement agreement reached earlier this year related to the broken Crystal River nuclear plant in Citrus County. Through 2016, Progress, now a wholly owned subsidiary of Duke Energy, will refund customers a total of $288 million.
Some of the immediate savings could be offset in future years by costs related to repairing the nuclear plant. The reactor's 42-inch thick concrete containment cracked in September 2009 when workers cut into the building to replace old steam generators.
"Progress Energy Florida is working to manage and mitigate expenses, and we are focused on keeping electric costs as low as possible for the more than 1.6 million households and businesses that depend on us," said Vincent Dolan, Progress Energy Florida state president.
Tampa Electric customers would see a smaller reduction in their bills of about $4. Still the average customer would go from paying about $106.90 currently to $102.58 each month next year. Tampa Electric, owned by TECO Energy, attributed its rate reduction to the decline in natural gas prices. The discovery of a huge supply of natural gas in the United States has led to substantial decreases in prices.