The two times people think about their electric company is when the lights go out and when the monthly bill arrives in the mail. To help ensure the lights stay on, Progress Energy Florida is telling its customers they may have to put up with higher electric bills for the next decade. The utility is asking for an extra charge (about $9 a month for a typical residential customer) to expand generating capacity with two nuclear reactors and more power lines.
Yes, Progress Energy wants its customers in 35 counties, including most of the Tampa Bay area, to pay for a $17-billion expansion of nuclear power. While many will react with skepticism or anger, Progress Energy is responsibly planning for the future. Demand for its electricity will grow by 25 percent in the next 10 years, which means building new generating capacity is essential.
Last week, the North Carolina-based utility asked the Florida Public Service Commission to approve its request for new reactors in Levy County. If that request is approved, Progress Energy could add about a 4 percent surcharge to utility bills beginning in January. It would take at least another year to win federal approval, and Progress Energy still could change its mind along the way.
Whatever the outcome, a new generating plant will have to be built in the coming years. The unanswered question is what type of fuel it will use. Given the soaring cost of oil and the adverse environmental impacts of coal, the choice narrows to natural gas or nuclear. Utility customers need to help make that decision, but first they need all of the facts.
Why nuclear? Until now, no new commercial reactors had been proposed in the United States since the 1979 accident at Pennsylvania's Three Mile Island nuclear plant. In recent years, the industry has improved its public image. Credit a good safety record, skyrocketing oil and natural gas prices, and an increased awareness of pollution (particularly greenhouse gases) from fossil fuels. Nuclear generation releases no carbon dioxide or other pollutants.
While a nuclear reactor has high construction costs, its fuel (uranium) is relatively inexpensive — with estimated fuel savings of $1-billion a year. Permanent storage of spent fuel is still unresolved, though it can be kept on site for the foreseeable future. And the discharge of hot water needed for cooling the reactors is no longer an environmental threat because the new plant would use a closed-loop system.
Why should customers pay up front? The simple answer is a new state law sought by Progress Energy allows it. The utility says it could not build a nuclear plant if it had to borrow the money before beginning construction because interest costs would make it too expensive.
Instead, it would probably build a plant powered by natural gas. While construction costs would be significantly less, fuel costs would be much higher and the supply less reliable. In its rate filing last year, Progress Energy reported that natural gas costs more than 18 times the equivalent amount of uranium. And if the nation finally decides to make utilities reduce their carbon emissions, the penalty for using natural gas or any other fossil fuel could be even higher.
So in going nuclear, utility customers would be asked to pay more now for future savings.
Progress Energy should be given a chance to make its case for nuclear power. The company can help itself by being honest about the costs, risks and rewards. While $17-billion is substantially more than initial estimates, the utility cannot let that cost drift further upward or customers will be understandably skeptical.
As for the most vocal critics of nuclear power — they should be honest, too. The growing energy needs of the state and Tampa Bay area cannot be met by energy efficiency alone. And renewable technologies, such as solar thermal or biomass, are not yet reliable for base-load generation and may never be.
The worst time to make a decision as important as this would be after we throw the light switch and nothing happens.