Florida Senate - 2013                             CS for SB 1472
       
       
       
       By the Committee on Communications, Energy, and Public
       Utilities; and Senators Legg, Latvala, Simpson, and Brandes
       
       
       
       579-03904-13                                          20131472c1
    1                        A bill to be entitled                      
    2         An act relating to nuclear and integrated gasification
    3         combined cycle power plants; amending s. 366.93, F.S.;
    4         modifying an alternative cost recovery mechanism for
    5         the recovery of costs for the siting, design,
    6         licensing, and construction of nuclear and integrated
    7         gasification combined cycle power plants; establishing
    8         a procedure and requirements for cost recovery based
    9         on preconstruction and construction phases; requiring
   10         the Public Service Commission to review the
   11         circumstances surrounding a proposed nuclear power
   12         plant if the anticipated cost and completion date
   13         exceed the original cost and completion date by a
   14         certain amount or period; specifying factors to be
   15         considered and dates by which the review must commence
   16         and be completed; providing an effective date.
   17  
   18  Be It Enacted by the Legislature of the State of Florida:
   19  
   20         Section 1. Subsections (1) through (3) of section 366.93,
   21  Florida Statutes, are amended to read:
   22         366.93 Cost recovery for the siting, design, licensing, and
   23  construction of nuclear and integrated gasification combined
   24  cycle power plants.—
   25         (1) As used in this section, the term:
   26         (a) “Cost” includes, but is not limited to, all capital
   27  investments, including rate of return, any applicable taxes, and
   28  all expenses, including operation and maintenance expenses,
   29  related to or resulting from the siting, licensing, design,
   30  construction, or operation of the nuclear power plant, including
   31  new, expanded, or relocated electrical transmission lines or
   32  facilities of any size which that are necessary thereto, or of
   33  the integrated gasification combined cycle power plant.
   34         (b) “Electric utility” or “utility” has the same meaning as
   35  that provided in s. 366.8255(1)(a).
   36         (c) “Integrated gasification combined cycle power plant” or
   37  “plant” means an electrical power plant as defined in s.
   38  403.503(14) which that uses synthesis gas produced by integrated
   39  gasification technology.
   40         (d) “Nuclear power plant” or “plant” means an electrical
   41  power plant as defined in s. 403.503(14) which that uses nuclear
   42  materials for fuel.
   43         (e) “Power plant” or “plant” means a nuclear power plant or
   44  an integrated gasification combined cycle power plant.
   45         (f) “Preconstruction” is that period of time after a site,
   46  including any related electrical transmission lines or
   47  facilities, has been selected through and including the date the
   48  utility completes site clearing work. Preconstruction costs must
   49  shall be afforded deferred accounting treatment and shall accrue
   50  a carrying charge equal to the utility’s allowance for funds
   51  during construction (AFUDC) rate until recovered in rates.
   52         (2) Within 6 months after the enactment of this act, the
   53  commission shall establish, by rule, alternative cost recovery
   54  mechanisms for the recovery of costs incurred in the siting,
   55  design, licensing, and construction of a nuclear power plant,
   56  including new, expanded, or relocated electrical transmission
   57  lines and facilities that are necessary thereto, or of an
   58  integrated gasification combined cycle power plant. Such
   59  mechanisms must shall be designed to promote utility investment
   60  in nuclear or integrated gasification combined cycle power
   61  plants and allow for the recovery in rates of all prudently
   62  incurred costs, including and shall include, but not be limited
   63  to:
   64         (a) Recovery through the capacity cost recovery clause of
   65  any preconstruction costs.
   66         (b) Recovery through an incremental increase in the
   67  utility’s capacity cost recovery clause rates of the carrying
   68  costs on the utility’s projected construction cost balance
   69  associated with the nuclear or integrated gasification combined
   70  cycle power plant. To encourage investment and provide
   71  certainty, for nuclear or integrated gasification combined cycle
   72  power plant need petitions submitted on or before December 31,
   73  2010, associated carrying costs must shall be equal to the most
   74  recently approved pretax AFUDC at the time an increment of cost
   75  recovery is sought in effect upon this act becoming law. For
   76  nuclear or integrated gasification combined cycle power plants
   77  for which need petitions are submitted after December 31, 2010,
   78  the utility’s existing pretax AFUDC rate is presumed to be
   79  appropriate unless determined otherwise by the commission in the
   80  determination of need for the nuclear or integrated gasification
   81  combined cycle power plant.
   82         (3)(a) After a petition for determination of need is
   83  granted, a utility may petition the commission for cost recovery
   84  as permitted by this section and commission rules.
   85         (b) During the time that a utility seeks to obtain a
   86  combined license from the Nuclear Regulatory Commission for a
   87  nuclear power plant or a certification for an integrated
   88  gasification combined cycle power plant, the utility may recover
   89  only costs related to, or necessary for, obtaining such
   90  licensing or certification.
   91         (c) After a utility obtains a license or certification, it
   92  must petition the commission for approval before proceeding with
   93  preconstruction work beyond those activities necessary to obtain
   94  or maintain a license or certificate.
   95         1. The only costs that a utility that has obtained a
   96  license or certification may recover before obtaining commission
   97  approval are those that are previously approved or necessary to
   98  maintain the license or certification.
   99         2. In order for the commission to approve preconstruction
  100  work on a plant, it must determine that:
  101         a. There is still a need for the plant; and
  102         b. The projected costs for the plant are reasonable.
  103         (d) After a utility obtains approval to proceed with post
  104  licensing or post-certification preconstruction work, it must
  105  petition the commission for approval of any preconstruction
  106  materials or equipment purchases that exceed 1 percent of the
  107  total projected cost for the project.
  108         (e) A utility must petition the commission for approval
  109  before beginning the construction phase.
  110         1. The only costs that a utility that has obtained
  111  commission approval may recover before beginning construction
  112  work are those that are previously approved or necessary to
  113  maintain the license or certification.
  114         2. In order for the commission to approve proceeding with
  115  construction on a plant, it must determine that:
  116         a. There is still a need for the plant; and
  117         b. The projected costs for the plant are reasonable.
  118         (f) If a utility has not begun construction of a plant
  119  within:
  120         1. Ten years after the date on which it obtains a combined
  121  license from the Nuclear Regulatory Commission for a nuclear
  122  power plant or a certification for an integrated gasification
  123  combined cycle power plant, it must petition the commission to
  124  preserve the opportunity for future recovery under this section
  125  for costs relating to that plant. The commission must determine
  126  whether the utility remains intent on building the plant.
  127         a. If the commission finds that the utility remains intent
  128  on building the plant, the utility may continue to recover
  129  costs.
  130         b. If the commission finds a lack of such intent, it may
  131  enter an order prohibiting recovery of any future costs relating
  132  to the plant, notwithstanding any other provision of law.
  133         2. Twenty years after the date on which it obtains a
  134  combined license from the Nuclear Regulatory Commission for a
  135  nuclear power plant or a certification for an integrated
  136  gasification combined cycle power plant, the utility may not
  137  recover future costs relating to that plant under this or
  138  another section, notwithstanding any other provision of law.
  139         Section 2. The Public Service Commission shall perform a
  140  comprehensive review of the continuing prudency, cost
  141  effectiveness, and need for any proposed nuclear power plant for
  142  which cost recovery under section 366.93, Florida Statutes, has
  143  been authorized if the currently anticipated inservice date for
  144  the plant has been extended more than 6 years beyond the
  145  original proposed inservice date and if the most recent estimate
  146  of the plant’s total cost has increased by more than 50 percent
  147  of the original cost estimate for the plant. In making this
  148  determination, the commission must consider all relevant
  149  factors, including, but not limited to, the utility’s need for
  150  the plant, technology and fuel choices, applicable federal and
  151  state licensing and permitting factors, and short- and long-term
  152  costs to ratepayers. Based on its review, the commission shall
  153  determine whether to authorize for cost recovery under section
  154  366.93, Florida Statutes, any new or future costs for which cost
  155  recovery has not already been authorized. Such review shall
  156  commence on or before June 1, 2013, and shall be completed by
  157  February 1, 2014.
  158         Section 3. This act shall take effect July 1, 2013.