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Legislators clash over what to do about paying for nuclear plants

TALLAHASSEE — Hoping the state would find out how Progress Energy botched an upgrade to a nuclear power plant that may never reopen?

Hoping to stop paying in advance for another nuclear plant that may never get built?

Don't count on it.

Senate Majority Leader Andy Gardiner told the Tampa Bay Times the Energy Committee, which he heads, would not hold hearings into the events that continue to keep the Crystal River plant off line.

Gardiner also said late Thursday he would not let the committee consider a bill to repeal a law forcing customers to pay in advance for a proposed $20 billion nuclear plant.

On Friday, New Port Richey Sen. Mike Fasano, who sponsored the bill, countered with a parliamentary Hail Mary.

Fasano attached language repealing the nuclear advance fee to another bill that will come before the Energy Committee on Monday morning. According to Fasano, that will force the full committee to discuss the bill and vote on it. At least eight of the 15 committee members will have to support Fasano's amendment for it to move forward.

Fasano's move is a long shot. The more issues that are tacked onto one bill, the more controversial the legislation becomes. And Republican senators might be nervous about clashing with Gardiner, a top lieutenant to Senate President Mike Haridopolos.

"I am asking for an up or down vote," Fasano said. "The customers deserve nothing less. They have already paid hundreds of millions of dollars toward this plant and are on the hook for hundreds of millions more."

In 2006, virtually the entire Legislature voted for the Nuclear Cost Recovery Clause bill, which helps pay for the construction of new nuclear power plants and to increase power at existing plants by collecting money from customers in advance. Proponents of the fee prefer to call it "pay-as-you-go" financing because customers pay as the utility incurs expenses and can potentially save on financing charges.

"I know Sen. Fasano is coming at this with an admirable consumer-protection motive," Gardiner said. "However, if we eliminate nuclear cost recovery, consumers' rates will skyrocket when plants are completed and ratepayers are hit with costs plus interest at the same time.

"While these plants are relatively cheap to operate, there are a lot of costs incurred early in the process," he said.

Progress Energy has used the law to help collect money to build a new nuclear plant in Levy County. Since 2006, the utility's cost estimates for the project have tripled to at least $20 billion. Progress has already spent, and its customers will have to pay, $1.1 billion in planning for the nuclear plant.

Progress is still trying to obtain its operating license, but delays and recent decisions by the utility suggest it will be a decade or more for the plant to come on line — if ever.

Customers have become increasingly alarmed at fees added to their monthly bills to pay for the plant. Recent news that Progress negotiated the right to cancel the engineering, procurement and construction contract further raised the possibility that the plant won't get built.

The law has also allowed Progress to continue to collect money connected to the Crystal River plant, which the utility damaged in 2009 during a project to replace old steam generators. So far the Public Service Commission has allowed Progress to collect $51 million from its customers for that power upgrade.

Critics of the existing law complain that it does not require utilities to complete projects or refund customers money if they decide to abandon them.

Peter Bradford, a former member of the U.S. Nuclear Regulatory Commission and a senior fellow for the Institute for Energy and the Environment at Vermont Law School, said that nuclear is an expensive way to produce power, and the notion that having customers pay for it in advance saves money is wrong because "it doesn't. It doesn't save customers money."

Despite Gardiner's stance, there is a growing chorus of opponents, including cities throughout the state and lawmakers in Tallahassee.

"I voted for it (in 2006)," said Sen. Charles Dean, R-Inverness, who said he now supports repealing the law. "But none of us really knew anything about this bill."

Added Rep. Betty Reed, D-Tampa, who wants the law repealed: "I would love to be paid now for something I might do in 10 years."

In the House of Representatives, Rep. Michelle Rehwinkel Vasilinda, D-Tallahassee, is sponsoring the companion bill to Fasano's Senate legislation that would repeal the advance fee.

Rehwinkel Vasilinda said though the repeal might not gain enough traction this year to pass, growing awareness of the problems with the cost recovery legislation is strengthening the chance for repeal in the future.

"It's been tough," she said. "But I'm building knowledge. I'm building a coalition."

Ivan Penn can be reached at or (727) 892-2332.

What's next

The state Public Service Commission will hold a public hearing on a settlement agreement with Progress Energy over its crippled Crystal River nuclear plant 1 p.m. Feb. 20 in Room 148, Betty Easley Conference Center, 4075 Esplanade Way, Tallahassee.

Legislators clash over what to do about paying for nuclear plants 02/03/12 [Last modified: Friday, February 3, 2012 10:49pm]
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