Tallahassee, Florida - The Florida Public Service Commission is considering a deal with Duke Energy that would require customers to pay $3 billion for expenses already incurred on canceled nuclear power projects.
Members of a group called "Stop Duke Rip-Off" rallied against the settlement outside a hearing in Tallahassee Wednesday.
Dalyn Houser said it would be outrageous for utility regulators to approve a deal that makes customers pay billions for nuclear projects that will never produce any electricity.
"We need to stop the bleeding of consumers, the ratepayers of Duke Energy, and cancel this meeting outright and move it to areas where people are actually living in the service area of Duke and give them a chance to speak out on the issue."
Houser estimated the settlement would cost about $2,000 in higher electric bills per customer.
Under Florida law, Duke-Progress Energy was legally able to charge customers for nuclear power costs before the plants were completed. Even though the Crystal River and Levy nuclear plants have been canceled, state law allowed the company to start collecting on previous work.
Protesters believe the money was not spent reasonably so customers should not have to pick up the tab.
"We believe that since the way these funds were used were in a reckless manner and incompetent manner that Stop Duke Rip-Off group of Pinellas County could be filing a class-action lawsuit against the PSC and Duke Energy," said Houser.
Duke Energy Associate General Counsel John Burnett called the settlement fair and reasonable.
He said customers will get a $388 million refund on replacement power costs and a total of $1.5 billion in financial benefits.
Under the deal, Duke writes off $295 million of debt on the Crystal River nuclear plant and collects an $835 million insurance payment on the failed plant. Burnett said those factors will benefit customers by reducing costs.
"This revised and restated settlement agreement between DEF and the parties who represent customers' interests before the commission is a fair and reasonable, comprehensive resolution of unique and complex issues that is in the best interest of DEF and its customers and that is in the public interest."
Rep. Dwight Dudley, D-St. Petersburg, called the settlement an outrage.
He accused the Public Service Commission of horrible policymaking, allowing a for-profit monopoly to get a deal that creates pain for customers.
Dudley blasted the advance nuclear recovery law, which allows utilities to collect fees for nuclear projects before they finished.
"I don't know where in American life we've seen this historically where billions of dollars are taken, wasted, horrible mistakes made and then it's put on consumers. It's just completely unfair and outrageous."
Florida Public Counsel J.R. Kelly, who represents consumers before the commission, said he decided to support the settlement because it's fair and reasonable.
He said it gives consumers the $388 million in refunds on the cost of fuel, finalizes the $835 million insurance payment and stops the Levy County nuclear project, which Kelly believes would have hit consumers hard with escalating costs and higher rates in the future.
"By and large, we do believe this is a very good resolution of the issues and one that will give some stability to the costs in the years to come that consumers will know what they have to pay."
Kelly said the settlement would help avoid extensive litigation. He said no one likes the fact that customers would pay $3 billion for nuclear projects that won't produce any electricity, but Florida law allows it.
"The law is what the law is. I can't litigate a case based on what I wish the law was. I have to litigate on what the law is and the law is quite clear. It's been upheld by the Florida Supreme Court and it allows Duke to recover costs even though they're shutting down Levy."
The commission adjourned Wednesday without voting on the settlement. Members will resume the hearing on Thursday and are expected to vote then.