Duke Energy Florida customers will see a new charge on their monthly bill starting in July — an "asset securitization charge" of $2.87 for the average home.
Translation: That's the charge customers must pay to cover Duke's costs for the closure of the Crystal River nuclear power plant in Citrus County.
The state Public Service Commission on Thursday gave its final approval on a bond issuance to pay nearly $1.3 billion over the next 20 years. In March 2017, the monthly charge is expected to fall slightly to $2.73 per 1,000 kilowatt hours of electric usage, according to Duke.
Duke could have decided to finance the cost of the Crystal River closure itself, forcing customers to pay a higher finance charge for up to 20 years. But under the bond plan, the utility will sell the $1.3 billion in debt to investors who get a lower return on their money.
If Duke had financed the cost itself, customers would have had to pay about 40 percent more, or an additional $2.08 per month, Duke said. The net present value of those savings over 20 years is nearly $700 million.
"We've worked hard on our customers' behalf to help save them money," said Duke spokeswoman Suzanne Barr Grant.
Duke announced the closing of the Crystal River nuclear plant in February 2013. That decision came after a botched upgrade and maintenance project by Duke's predecessor, Progress Energy, cracked the reactor's 42-inch-thick concrete containment building. Attempts to repair the building and bring it back online led to more cracks.
Duke, which bought Progress in 2012, initially considered repairing the plant, but ultimately decided that would be too expensive.
At the time the bond issuance was proposed in 2015, Sen. Jack Latvala, R-Clearwater, had said senior executives from Duke Energy's corporate offices in Charlotte, N.C., met with him to discuss how the much-maligned utility can boost the low customer satisfaction ratings it regularly receives.
"They're tired of the bad press," Latvala said at that time.
The bond issue was seen as one way to do that, though state lawmakers had to pass legislation to permit it. Duke's decision was praised by the Office of Public Counsel, which represents consumer interests before the PSC.
Contact William R. Levesque at email@example.com. Follow @Times_Levesque.