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Progress Energy rates will drop more than $7

Progress Energy Florida electric rates will drop $7.13 beginning Jan. 1, a long-expected decrease largely attributable to a refund of costs related to the broken Crystal River nuclear plant.

With the rate drop, the average Progress customer will pay $116.06 per 1,000 kilowatt hours of usage, down from $123.19.

The new rates were approved Tuesday by the state Public Service Commission. It approved rates for Tampa Electric customers earlier this month. Tampa Electric customers will pay $102.58 per 1,000 kilowatt hours of usage in 2013, down $4 compared to this year.

The changes in rates for the two primary power companies in the Tampa Bay area will bring both utilities below the current national average of $119 a month, according to the Energy Information Administration.

But the drop in rates still isn't likely to bring Florida on par with other Southeastern states, which have had rates 10 to 20 percent lower than the Sunshine state, according to a study released last year by the University of Florida's Public Utility Research Center.

Much of the decrease in Progress' rates resulted from a settlement agreement between the state and Progress Energy over damage to the Crystal River plant, which has been sitting idle for three years. The 42-inch-thick concrete containment building that houses the plant's nuclear reactor cracked during a maintenance and upgrade project. An attempt to repair the crack resulted in more cracks.

As part of a settlement approved earlier this year, Progress agreed to refund customers $288 million spent to buy power during Crystal River's outage.

All utility customers also are benefiting from a drop in natural gas prices.

The decrease in Progress' rates for 2013 and possibly the next couple of years is not expected to last long. Rates are expected to rise when the refunds for Crystal River end in the next couple of years.

In addition, rates could jump after Progress and its parent company, Duke Energy, decide whether to fix or shut down Crystal River and whether to build the proposed $24 billion Levy County nuclear plant.

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

Progress Energy rates will drop more than $7 11/27/12 [Last modified: Tuesday, November 27, 2012 10:25pm]
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