by Robert Trigaux
A class-action lawsuit was filed against Duke Energy Florida and Florida Power & Light Co. alleging the monopoly electricity providers force millions of Florida customers to pay unlawful charges in connection with their electricity rates to fund the companies’ nuclear power plant projects, some of which have been abandoned.
The suit was brought Monday by the law firm Hagens Berman in the U.S. District Court for the Southern District of Florida. It accuses Duke Energy Florida and FPL of overcharging through unconstitutional price hikes that increase customers’ electricity bills in order to fund nuclear construction costs.
The issue ranks among the most controversial in recent Florida history, forcing customers of monopoly utilities to take on the financial risk of building nuclear power plants, projects prone to extreme cost overruns. Such utility projects historically have been financed by banks and Wall Street, with the risks borne by Duke and FPL shareholders, not by ratepayers.
The suit claims Duke Energy Florida, which provides the bulk of electricity to the Tampa Bay and west-central Florida areas, unlawfully charged customers higher rates to cover more than $1.2 billion in expenses at its Crystal River nuclear power plant in Citrus County and at its proposed (and now shelved) Levy County nuclear plant site. Similar claims are made in the suit against FPL, Florida’s largest utility, for expenses tied to its nuclear power plants, including two new ones proposed at its Turkey Point site in South Florida.
At the core of this dispute, according to the lawsuit, are nuclear costs imposed on ratepayers by orders of the Florida Public Service Commission under a law passed in 2006 by Florida legislators and approved by then-Gov. Jeb Bush. That law created a nuclear cost recovery system that, the suit states, “makes ratepayers into involuntary investors in nuclear projects, charges them interest on their own money, and never returns their ‘investment.’ When the projects are abandoned, the utilities keep the money and collect even more.”