Estimated last year at up to $1.3 billion, repair costs for the damaged Crystal River nuclear facility are “trending higher,” Duke Energy Corp. officials told investors Thursday as the company released its first financial statement since acquiring Progress Energy last month, reports Michael Peltier of the News Service of Florida.
Speaking to analysts following the release of Duke’s second quarter earnings, Duke President and CEO Jim Rogers said the company won’t know for some time just how much it will cost to repair a Crystal River reactor unit that was first damaged in 2009 and again during repairs in 2011.
Further, Rogers said the company doesn’t yet know whether it is more cost effective to fix the unit or shut it down permanently. He plans to testify before the Florida Public Service Commission Aug. 13 to provide updates to the panel on company plans for the Crystal River facility. The company in February reached an agreement with Florida regulators that includes incentives for beginning repairs by Dec. 31.
“Although we recognize the importance of making a decision on repair or retire by the end of 2012 under the Florida settlement agreement, we are not prepared at this time to set a date certain by which such a decision will be made,” Rogers said Thursday.
What is known is that repair costs will likely be higher than previously estimated. Just how much higher, however, remains to be seen. Estimates made last year put repair costs at between $900 million and $1.3 billion.
“The repair plan appears to be technically feasible but issues remain that need to be resolved as the engineering and risk assessment continues,” Rogers said.
Rogers made the comments as he and Duke CFO Lynn Good briefed analysts over second quarter earnings. Duke, which finished its acquisition of Progress Energy in July, is the largest electrical generator in the United States with 7 million customers.
Duke announced second quarter adjusted earnings of $456 million, or $1.02 per share, compared to $444 million, or 99 cents per share for second quarter 2011. The figures reflect a reverse stock split of one-for-three conducted before Duke acquired Progress, Florida’s second largest electric utility, on July 2.
Progress, meanwhile reported second quarter earnings of $80 million, or 27 cents per share, compared to $211 million, or 71 cents per share, for the same period last year. Beginning in the third quarter, the companies’ financial statements will be combined.