The Florida Supreme Court on Thursday rejected a challenge to a controversial law that allows utilities to collect money from customers for nuclear plants that won’t be built for years — if ever, reports Jim Saunders of the News Service of Florida.
The unanimous ruling, in a challenge filed by the Southern Alliance for Clean Energy, found that the 2006 law did not violate the Florida Constitution by shifting too much decision-making power to the state Public Service Commission. Also, it upheld PSC decisions that allowed Florida Power & Light and what was then known as Progress Energy Florida to collect $282 million in nuclear-project charges from customers in 2012.
“Authorizing recovery of preconstruction costs through customer rates in order to promote utility company investment in new nuclear power plants, even though those plants might never be built, is a policy decision for the Legislature, not this court,” the 21-page opinion said.
The ruling was released about an hour before the Senate gave final approval to a bill that would make changes to the law, which has become a particularly heated political issue in Tampa Bay area. The proposed changes stop short of repealing the law or requiring refunds to customers, as some critics have sought.
FPL and Progress, which is now known as Duke Energy, go before the PSC each year to seek approval to collect varying amounts of money to cover expenses such as licensing work on nuclear projects. Ordinarily, utilities have to wait until after power plants are operating to recoup costs from customers, but the 2006 law allows nuclear costs to be collected in advance.
Utility officials say the advanced collections are needed, at least in part, because of the large upfront costs of nuclear projects. The Legislature approved the law to try to encourage construction of new nuclear plants for the first time in decades.
Much of the controversy centers on a Duke proposal to build two reactors in Levy County and an FPL proposal to build reactors in Miami-Dade County. While the utilities have been collecting and spending money on those projects, there is no guarantee the reactors will be built. Part of the money, however, also has gone to projects to upgrade already-existing FPL nuclear plants.
The Southern Alliance for Clean Energy filed the legal challenge after the PSC decided to allow FPL to collect about $196.1 million in nuclear costs in 2012 and to let Progress collect $85.9 million. The group contended that the law violated the state Constitution because it gave too much decision-making authority to the PSC.
But the Supreme Court rejected that argument, which involved the separation of powers between the Legislature and the regulatory agency. Justices said there wasn’t any indication that the Legislature’s policy-making authority had been “usurped by or improperly transferred to the PSC.”
Also, the Southern Alliance for Clean Energy focused on details of the PSC’s approval of the 2012 nuclear charges. Those details involved whether the utilities had adequately shown an “intent to build” the new reactors.
The court said that “competent, substantial evidence supports the PSC’s findings to the effect that the utility companies engaged in preconstruction activities creating an option to build the nuclear power plants at issue.”
