Make us your home page

Progress Energy to review whether insurance will cover nuclear plant repairs

Progress Energy's insurer has launched its own review of the outage at the Crystal River nuclear plant to determine whether insurance will cover repairs to the broken reactor building.

Bill Johnson, Progress' president and chief executive officer, told investors Thursday that the utility's insurer has appointed a special committee of its board and hired engineering consultants to review the Crystal River plant.

Progress wants the insurer, Nuclear Electric Insurance Limited (NEIL), to cover three-quarters of the $2.5 billion it will cost to fix the nuclear plant, which first broke during a maintenance and upgrade project in fall 2009. Costs not covered by NEIL would rest on the shoulders of the utility's customers or investors.

The plant's concrete containment building cracked when workers were replacing old steam generators, and again when the utility tried to repair it and bring it back online. The reactor is not expected to return to service for at least two more years — if at all.

"This is a complex matter, and it's in our best interest to work cooperatively with NEIL to provide them with all the information they need to make their coverage decisions," Johnson, who sits on NEIL's board of directors, said during a quarterly report webcast Thursday.

NEIL declined to comment, saying it does not "disclose comments or any information involving its members."

NEIL insures Crystal River and the 103 other nuclear plants across the country.

NEIL had been making payments for some of the repairs and for Progress to purchase electricity to replace power the Crystal River plant used to supply.

But no such payments were made during the third quarter of this year.

In addition, Progress said during hearings this week before the state Public Service Commission that repair work since mid December 2010 has not been covered by NEIL as of yet.

That raised concerns among investors about whether NEIL might not pay for any more of the costs related to Crystal River or even order repayment of money already paid, if the insurer determines the damage to the nuclear plant is not covered under the policy.

"In the event that NEIL determines this is not a covered event, would they claw backwards the proceeds you've already received?" asked Paul Ridzon of Keybanc.

"I'm not going to entertain the notion that they don't think it's a covered event," Johnson responded. "So we haven't given any thought at all to the question you've asked."

Johnson said he expects NEIL to make a determination by the end of the year.

Ivan Penn can be reached at or (727) 892-2332. Follow him on Twitter at and find the Consumer's Edge on Facebook.

Progress Energy to review whether insurance will cover nuclear plant repairs 11/04/11 [Last modified: Friday, November 4, 2011 10:55pm]
Photo reprints | Article reprints

© 2017 Tampa Bay Times


Join the discussion: Click to view comments, add yours

  1. Rep. Larry Ahern gets roughed up by Clearwater City Council

    State Roundup

    It seemed innocuous enough: an "end of session report" from state Rep. Larry Ahern, R-Seminole, to the Clearwater City Council.

    Then Ahern got taken to the woodshed.

    Rep. Larry Ahern is vying for a seat on the Pinellas commission.
  2. There's a bar in Tampa where you can roller skate and eat sushi

    Food & Dining

    Roller skating, it's not just for kids birthday parties and the 1970s anymore.

    The exterior of Pattinis features this mural by Art Aliens! [Pattinis South Tampa via Facebook]
  3. Lockdown: Florida's 97,000 prison inmates confined through weekend

    State Roundup

    All of Florida's 97,000 state prison inmates are on lockdown — and will remain confined to their dorms at least through the weekend — in response to unspecified threats about possible uprisings, officials from the Florida Department of Corrections confirmed Thursday.

    Blackwater River Correctional Facility. [Florida Department of Corrections]
  4. Carnival announces five more cruises from Tampa to Cuba


    TAMPA — Carnival Cruise Line is adding five more cruises from Tampa to Cuba in 2018, Port Tampa Bay announced Thursday.

      Carnival Cruise Line announced additional cruises to  Cuba. Pictured is its Paradise cruise ship departing on its inaugural voyage to Cuba from Tampa. | [MONICA HERNDON | Times]
  5. Engage Behavioral Health expands into Wesley Chapel


    On Aug. 5, Engage Behavioral Health celebrated the grand opening of a new clinic in Wesley Chapel.

    hillsevbiz081117: Jennifer Phelps is the CEO & Founder of Engage Behavioral Health. Photo courtesy of Engage Behavioral Health.