Regulators order Duke to stop charging nuclear plant fee

By Fallon Silcox, Reporter
Last Updated: Friday, October 03, 2014, 7:27 AM EDT

State regulators are ordering one of Florida's largest power companies to refund $54 million it collected from ratepayers to pay for a failed nuclear plant.

The Florida Public Service Commission voted Thursday to require Duke Energy to credit customers for equipment intended for a plant in Levy County. The company never received the equipment and is suing the vendor.

Duke announced last year it was abandoning plans to build the plant in the small county on the Gulf coast.

"Yeah, I mean if they're not going to build it they should give the money back," said Scott Gill, a Duke Energy customer.

A Duke spokesman said the company will remove a $3.45 charge from customers' bills starting in late 2015 or 2016.

"We recognize that rate payers are frustrated and that is a reality," said PSC member Ronald Brise. "Our duty I believe is to find a way to address the issues that are frustrating the consumers but do it in a way that reflects our current statutory framework."

Sometime next year that Duke Energy will wipe out the monthly charge that customers are paying for costs associated with a now-scuttled nuclear plant. Duke announced last year it was abandoning plans to build the plant in Levy County, but consumers are still paying for costs associated with the plant.

Duke Energy Florida has roughly 1.7 million customers.

"Essentially customers will continue to be paying $3.45 on their bills. They're just going to pay for a shorter period of time until the company recovers all of our expenses," said Sterling Ivey with Duke Energy.

Customers will not be getting a lump sum refund.

Some customers said they doubt they'll be seeing a drop in the bills at all.

"I believe we're never going to see that. I think that something else is going to show up," said Efraim Martinez.

The PSC also approved a new power plant for Citrus County and it's possible the Commission could allow Duke Energy to charge customers a fee to help build that facility in the future.

PSC previously approved fees

Before ordering the credit, the PSC on Thursday also approved overall nuclear fee rates from both Duke customers and customers of Florida Power & Light. FPL's charges are projected to drop to 15 cents a month in 2015. Duke's charge will drop about 11 cents to $5.51 a month in January as well. The $3.45 charge associated with Levy is part of that overall total and is expected to be removed by mid-year.

The Republican-controlled Florida Legislature back in 2006 passed a law that gave utilities the ability to collect money up front for nuclear power projects as a way to encourage the possible growth of nuclear power in the state.

Progress Energy, which has since merged with Duke Energy, started collecting money from customers to pay for repairs to its existing Crystal River plant as well as pay for the start-up costs associated with the Levy plant.

But Charlotte, N.C.-based Duke decided last February to permanently close the Crystal River nuclear plant after repairs did not go as planned. Workers cracked a concrete containment wall in 2009 and an attempt to fix the problem in 2011 resulted in more cracks.

In 2013, Duke officials announced they were abandoning the Levy County plant due to changes in the energy market and regulatory hurdles at the state and federal level.

Information from the Associated Press was used in this report.