Florida Regulators Greenlight Cost Recovery for New Nuclear Builds, Capacity Additions

Florida’s Public Service Commission (PSC) on Monday approved cost recovery amounts for construction of new nuclear power facilities and additions to existing nuclear plants planned by Progress Energy Florida and Florida Power & Light Co. (FPL). The decision would help secure “a diversified and stable energy future for Florida,” regulators said.

The state body approved $86 million in recovery costs for Progress Energy, including those associated with construction of two reactors at its planned Levy Nuclear Plant. Cost recovery was also approved for the company to add capacity to its existing Crystal River nuclear plant—a facility that has been shut down for major repairs to its containment building since 2009.

The company will remove and replace concrete in the containment structure walls, repairs that could cost between $900 million and $1.3 billion and keep the plant shut until 2014. The commission is expected to consider whether to pass on costs related to the repairs in 2012.

“A stipulated agreement, approved in August and included in [Monday’s] decision, saves PEF customers $500,000 in Project Management Costs for adding capacity to Crystal River Unit 3 (CR3),” the PSC said in a statement. “The stipulation—between [Progress Energy Florida], the Office of Public Counsel, and other intervenors—resolved whether the company prudently managed its CR3 uprate license agreement.”

The PSC on Monday also approved $196 million in recovery costs for FPL, including costs associated with construction of its planned Turkey Point Units 6 and 7 and adding capacity to existing Turkey Point Units 3 and 4 and St. Lucie Units 1 and 2. “Over the life of the generating units, the additional capacity projects are expected to save customers an estimated $155 million to $1.5 billion,” the PSC said.

Estimated 2012 nuclear cost recovery is about $2.93 per month for the first 1,000 kWh for Progress Energy customers and about $2.20 per month, based on the current customer sales forecast, for the first 1,000 kWh for FPL customers. The final approved amount for both PEF and FPL customer bills will be recovered through the fuel and capacity cost recovery charge on customer bills beginning next year.

The Florida Legislature enacted a law in 2006 to encourage the development of nuclear power. The law allows utilities to recover some nuclear plant project costs during the construction process.

Sources: POWERnews, Florida PSC, Progress Energy