By LLOYD
DUNKELBERGER
Sun Tallahassee Bureau
February
14. 2007 6:01AM
TALLAHASSEE — In a move that could provide more
financial incentive for building nuclear power plants, the Florida Public
Service Commission on Tuesday adopted new rules that will let investor-owned
utility companies recover some of the costs of the new plants before they begin
operation.
The immediate beneficiary of the rule change could be Progress
Energy, which is taking steps to build the state's first nuclear power plant
since 1977, when the company began operating its Crystal River facility. Progress Energy has
identified a 3,000-acre site in Levy
County eight miles north of the
Crystal
River complex as the
possible location for a new nuclear plant.
PSC officials said the new
rules will allow companies like Progress Energy to request the partial recovery
of the planning and construction costs of a new nuclear plant before it begins
operation. Allowing the companies to recoup those costs earlier will encourage
more investment in the facilities while lessening the chance for "rate shock"
that could occur if the company waited to recoup all its construction costs when
the plant began operation.
Additionally, PSC officials said encouraging
the construction of more nuclear plants will allow the state to diversify its
electric power sources and avoid problems like the disruption of fossil fuel
supplies during a hurricane season.
"A diverse and balanced mix of fuel
sources protects customers from significant price fluctuations and makes
fuel-related power disruptions less likely," PSC Chairman Lisa Polak Edgar said
in a statement. "The new rules will protect ratepayers while promoting
investment in Florida's energy future."
Buddy Eller,
a spokesman for Progress Energy, said the new rules have the potential to save
consumers "several billion" dollars by paying some of the costs up front rather
than trying to recover the expenses in a rate base spread over the 40- to
50-year lifetime of a nuclear plant.
Eller said the PSC showed "a lot of
foresight" in adopting the new rules since in addition to avoiding rate shock
for consumers, it will also mean state regulators can take an earlier look at
the construction costs as the project proceeds.
Some environmental groups
questioned the state's encouragement of more nuclear power plants.
"I
think it's really disappointing," said Holly Binns of Environment
Florida.
Rather than promoting more nuclear plants, Binns said the state
could be diversifying and lessening its reliance on power plants by encouraging
more energy efficiency programs at a much lower cost than building a nuclear
facility.
Progress Energy has not made a final decision on whether it
will actually build a new nuclear plant. If it proceeds, the next step will be
to document the need for the facility in a hearing before the Florida PSC.
Company officials said that won't occur until the end of this year or early next
year.
Following that, Progress Energy will have to go through a lengthy
review by the federal Nuclear Regulatory Commission.
Under a tentative
timetable, Progress Energy officials say they will make a decision on whether to
build the plant by 2010. Construction would be completed by 2016 if the company
proceeds.
Other companies are also exploring the possibility of building
more nuclear plants in Florida. In Southeast Florida, Florida Power
and Light, which operates two nuclear facilities in that region, has indicated
it may build another plant, although it hasn't identified a potential
site.
