* First reactor delayed to 2024 from 2021
* Cost estimate up to $19 billion-$24 billion
* NRC expected to issue license in 2013 to build Levy
By Scott DiSavino
May 2 U.S. power company Progress Energy Inc's
Florida utility has delayed the in-service date for the
first reactor at the proposed Levy County nuclear power plant on
Florida's west coast to 2024, with the second unit following 18
The company also boosted the cost estimate for the
2,200-megawatt Levy project to between $19 billion and $24
billion, it said in a statement.
Previously, the company said the first unit at Levy was
expected to enter service in 2021 at an estimated cost of $17
billion to $22 billion.
Progress, based in North Carolina, said it pushed back the
schedule and raised the cost estimate because of
lower-than-expected customer demand, economic slowdown,
uncertainty over potential carbon regulation and low natural gas
"Nuclear remains a key component of Progress's balanced
solution strategy to meet customers' future energy needs,"
Vincent Dolan, president and CEO of Progress Energy Florida,
said in the statement.
The company included the schedule and cost changes in its
annual nuclear cost-recovery projections with Florida's utility
regulator for the 2013 billing cycle.
In addition to the proposed new reactors, Progress wants to
increase the output of the 860-megawatt Crystal River nuclear
plant in Citrus County, near Levy.
Florida's nuclear cost-recovery rules, which are similar to
regulations in other U.S. Southeast states seeking more nuclear
power, allow utilities to recover development, construction and
interest costs for new nuclear projects.
Georgia and South Carolina are using similar cost-recovery
rules to encourage units of Southern Co and Scana Corp
and partners to build new reactors in their states.
Utilities say the rules make reactor construction possible
and help reduce customer costs.
Florida wants more nuclear power in part because natural gas
fuels about 60 percent of the state's capacity, Progress said.
"Overdependence on any fuel can expose customers to fuel
cost spikes and supply disruptions. (Florida's utility
regulator) has cited the growing lack of fuel diversity in the
state as a major strategic concern," Progress said.
Natural gas is cheap now, near a 10-year low of around $2.30
per million British thermal units, but over the past decade it
has averaged above $6 and spiked to more than $15.
RATES TO RISE
If Florida regulators approve of Progress' request, the
company said total nuclear cost-recovery charges would be $5.09
on a 1,000-kilowatt-hour (kWh) residential bill beginning with
January 2013 billing, compared to $2.86 in 2012.
Progress said the 2013 breakdown would be $3.45 on a
1,000-kWh residential bill for Levy and $1.64 for Crystal River,
up from $2.67 for Levy and 19 cents for Crystal River in 2012.
Progress said the Levy portion of the bill would be fixed at
$3.45 through 2017.
Crystal River has been off line since September 2009, when a
refueling and power up-rate began. During the upgrade, workers
discovered a gap in the concrete containment dome, which was
opened to install new steam generators.
Crystal River was originally expected to restart in April
2011 but Progress said last summer the unit would not restart
until 2014. The company has estimated the cost of repairing the
containment structure at between $900 million and $1.3 billion.
Last week, U.S. Nuclear Regulatory Commission (NRC) staff
said in a final report that there were no environmental impacts
that would preclude issuing construction and operating licenses
for the proposed Levy reactors.
Progress expects the NRC will decide on the Levy licenses in
Progress applied with the NRC in July 2008 to build and
operate two Westinghouse Electric AP1000 reactors at Levy.
Westinghouse is majority-owned by Japanese multinational
In January, Progress agreed to a $13.7 billion merger with
neighboring North Carolina power company Duke Energy.
Duke is also seeking to build a nuclear plant at Lee in
South Carolina and last summer signed a letter of intent to buy
a potential stake in the Summer reactors being built by Scana
and partners in South Carolina.
Officials at Duke were not immediately available to say
whether a combined Duke-Progress would pursue new reactors at
both Levy and Lee.