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PSC Begins Nuclear Plant Recovery Cost Hearings

August 9, 2011 - 6:00pm

Customers of two of Floridas largest electric utilities could see higher rates if state regulators determine the increase is warranted to recover costs related to nuclear plant upgrades and new plant construction.

Hearings before the Florida Public Service Commission began Wednesday, where Florida Power & Light (FPL) set out its case for a rate adjustment that would boost the cost of electricity for its customers by $2.09 per 1,000 kilowatt hours. Progress Energy will make its case when the FPL hearing is concluded next week. Together, the companies are seeking a $335 million rate increase next year.

Bryan Anderson, a lawyer for FPL, defended the rate hike, asserting that legislation passed in 2006 aimed at spurring nuclear energy investment encouraged the companies to seek upgrades and plans to start new plants. Those plans were fast-tracked in 2007, but the Office of Public Counsel, which represents consumers and opposes the rate increase, wanted to use testimony criticizing that decision and undercutting the justification for related rate increases in 2009 and 2010.

In asking for the testimony to be excluded from the hearing, Anderson said that was tantamount to re-litigating the issue, and violates FPLs legal protection against double jeopardy.

We believe the testimony should be stricken. I think we really are doing harm to the process. Its a double-jeopardy issue. Weve litigated it before and now were going to litigate it again, Anderson said.

But OPC officials said the decision to fast-track the application was imprudent and should be considered as part of the deliberations over 2009 and 2010 rate judgments. Laws designed to encourage nuclear energy investment didnt take away the PSCs power to regulate its expansion, they claimed.

When the Legislature encouraged electric utilities to invest in nuclear energy the Legislature did not eliminate this commissions role from protecting consumers from unfair costs, said OPC attorney Joseph McGlothlin.

FPL is seeking upgrades to its reactors at Turkey Point near Miami and in Port St. Lucie as a way of increasing its nuclear capacity by 15 percent and reducing its dependence on fossil fuels for energy. Its rate increase request is $172 million for next year.

Progress Energy wants to build two new nuclear plants in Levy County. Those plans are at the heart of its $135 million rate increase proposal.

PSC staffers said testimony related to the 2007 decision was too intertwined with data related to the 2009 and 2010 rates to be stricken from the hearing.

The decision to fast-track, we think, is relevant to this proceeding, said PSC legal counselor Anna Norris.

Commissioners ultimately voted to include the testimony, but consider it only as it relates to justifying the rates of the past two years.

The hearings are expected to continue for the next two weeks.

Reach Gray Rohrer at or at (850) 727-0859.

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