FL PSC hearings to scrutinize new reactors’ cost

Guest Blog | September 8, 2009 | Press Releases

TALLAHASSEE, Fla. – Important hearings at the Florida Public Service Commission (PSC) begin today to scrutinize a request by the state’s two largest utilities to pass on to consumers more than half a billion dollars in early costs associated with the planned construction of four new nuclear reactors. The current hearings are designed to test the long-term feasibility of the proposed nuclear projects and whether the proposed costs are prudent and fair to Florida consumers. The Southern Alliance for Clean Energy (SACE) has intervened in the case and argues that both Florida Power & Light (FPL) and Progress Energy of Florida’s requests should be denied.

“To approve these costs is tantamount to deciding that Florida consumers must write a blank check and hand it over to the investors in these big power companies – allowing the private investors to cash in even if the new nuclear plants go bust,” said Southern Alliance for Clean Energy’s Executive Director Stephen Smith. “Fortunately the utilities aren’t far down the path yet. That’s why these hearings are so important because there is still time to change course.”

Experts for SACE will testify that, among other critical omissions, Florida Power & Light and Progress Energy failed to adequately consider the offsetting effects of stepped-up energy efficiency and conservation efforts, or the offsetting effects of an increase in the power produced by clean, renewable energy – efforts that could negate the need to build the new nuclear reactors. FPL intends to build two new reactors at their existing Turkey Point nuclear plant on Biscayne Bay near Miami while Progress is pursuing two new reactors at a currently undeveloped site in Levy County, less than ten miles from their existing Crystal River nuclear plant.

A still more glaring omission exists in the failure of the utilities to consider the wave of profound changes altering the state, national and global economy, according to Dr. Mark Cooper, a noted economic policy analyst who will testify for SACE during the PSC hearings that run through September 11.

The extreme decline in electricity demand was of particular concern as highlighted in expert testimony filed earlier this summer, including the state’s double-digit jobless rate and sudden loss after decades of growth in population, which signals new declines in demand.

“At the time these utilities planned these plants they assumed a high rate of growth and that growth blew a fuse in the national economy,” said Dr. Cooper. “The decade on which the projections were based in the need docket coincided almost exactly with the decade in which housing and consumption bubbles were pumped up by excessive leverage. That level of growth was unsustainable and the state has since plunged into a recession from which it isn’t predicted to fully emerge for some time.”

Data indicates that electricity demand in Florida has decreased and the decrease already is greater than the amount the four new nuclear reactors would generate. Similar decreases played a role in the cancellation of nuclear reactors in the 1970s and 1980s.

Mr. Arnold Gundersen, a nuclear safety engineer and energy advisor with 38 years of nuclear experience, also highlighted in pre-filed testimony for Southern Alliance for Clean Energy that the proposed projects will experience construction delays and cost overruns in the future that will negatively impact Floridians, if these reactors are ever built. He also argued that these delays were not properly accounted for by either utility.

“We believe that there is now more extensive and current information showing the high risks of building new nuclear reactors in Florida than when the utilities were first given the go-ahead,” said Sara Barczak, program director of Southern Alliance for Clean Energy’s high risk energy choices program. “These hearings provide a crucial opportunity to protect Florida families and businesses from being hit even harder by the unwise decisions that FPL and Progress are keen on pursuing in spite of today’s harsh realities.”

View SACE expert witness pre-filed testimony from July 2009 and more information about the September 8-11, 2009 FL PSC hearings at http://www.cleanenergy.org/index.php?/Take-Action.html?form_id=51&item_id=49.

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Southern Alliance for Clean Energy is a nonprofit organization that promotes responsible energy choices that create global warming solutions and ensure clean, safe, and healthy communities throughout the Southeast. For more information, go to: www.cleanenergy.org