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Progress Energy Florida fee for nuclear plant stays, PSC decides

TALLAHASSEE — Progress Energy Florida can keep billing customers, although at a slightly lower rate, for another year for a nuclear power plant that might never be built, state utility regulators agreed Tuesday.

The Public Service Commission unanimously agreed to let the utility recover $163.6 million in nuclear plant construction costs from customers in 2011, down from $206.9 million this year.

Residential customers will pay a fee of $5.53 for 1,000 kilowatt hours per month, which is about average for a small home. That's $1.42 less than they are paying now.

Consumer advocates had urged the commission to discontinue the fee until the company, which serves Central and North Florida, decides whether to build a nuclear plant in Levy County.

"We have not committed to that," Progress spokeswoman Cherie Jacobs acknowledged. She said no decision will be made until the company gets a federal license, which is expected in late 2012.

Fee revenue also covers upgrades to the plant at Crystal River. The two projects together would generate 2,380 megawatts of electricity, or enough to power 1.3 million homes.

The commission's decision "confirms the state's commitment to state-of-the-art nuclear power as a strategic asset," Jacobs said.

The Legislature passed a law in 2006 that lets utilities begin charging customers for nuclear plant costs during construction. Costs for conventional plants cannot be recovered until they are completed.

At an August hearing, Southern Alliance for Clean Energy lawyer Gary Davis took a stronger stand than that taken by consumer advocates, including the state Public Council's Office and the Florida Industrial Power Users Group.

Rather than just putting the Progress request on hold, Davis argued that nuclear cost recovery should be denied for all utilities because they have failed to prove a need for more nuclear power or that the expenses of such facilities are reasonable and prudent.

Davis said if the Levy County plant is built, it would add about $40 to the average customer's monthly bill when it's ready to go on line in about 10 years.

The commission has delayed action on a Florida Power & Light request for $31 million in nuclear cost recovery. The requested amount, down from $62.7 million this year, would reduce the current charge for 1,000 kilowatt hours per month from 67 cents to 33 cents in 2011.

PSC elects chairman

The Florida Public Service Commission tossed tradition aside Tuesday to elect newcomer Arthur Graham as chairman over Commissioner Nathan Skop, who will be leaving at the end of the year. Skop is the last of four commissioners being shown the door by lawmakers, or a nominating panel appointed by legislative leaders, after voting down large rate increases sought by Florida's two biggest power companies. Skop said he should have been elected chairman under a commission tradition that gives the job to the most senior member who hasn't yet held it. The utility regulating panel, though, voted 3-1 for Graham, with Skop dissenting. One of the five seats is vacant. Commissioner Lisa Edgar moved for Graham's election. She said the commission "must look beyond individual aspirations" and "beyond the headlines of today."

Progress Energy Florida fee for nuclear plant stays, PSC decides 10/26/10 [Last modified: Wednesday, October 27, 2010 7:48am]
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