HB 1101

1	A bill to be entitled
2	An act relating to cost recovery for the siting, design,
3	licensing, and construction of nuclear and integrated
4	gasification combined cycle power plants; amending s.
5	366.93, F.S.; revising provisions for the recovery of
6	costs; authorizing a utility to recover costs through
7	rates upon a determination by the Public Service
8	Commission that the costs are prudent; providing that
9	approved rates shall not become effective prior to a
10	certain date; providing for adjustment of rates approved
11	without a determination that the costs are prudent;
12	providing for refunds to customers; removing a provision
13	for recovery of the net value of displaced generating
14	plants; removing provisions that allowed recovery of
15	certain costs when the utility elects not to complete
16	construction of a nuclear power plant or integrated
17	gasification combined cycle power plant; requiring refunds
18	to customers of amounts recovered for an abandoned project
19	and specifying manner of refunds; providing an effective
20	date.
21
22	Be It Enacted by the Legislature of the State of Florida:
23
24	Section 1.  Section 366.93, Florida Statutes, is amended to
25	read:
26	366.93  Cost recovery for the siting, design, licensing,
27	and construction of nuclear and integrated gasification combined
28	cycle power plants.--
29	(1)  As used in this section, the term:
30	(a)  "Cost" includes, but is not limited to, all capital
31	investments, including rate of return, any applicable taxes, and
32	all expenses, including operation and maintenance expenses,
33	related to or resulting from the siting, licensing, design,
34	construction, or operation of the nuclear power plant, including
35	new, expanded, or relocated electrical transmission lines or
36	facilities of any size that are necessary thereto, or of the
37	integrated gasification combined cycle power plant.
38	(b)  "Electric utility" or "utility" has the same meaning
39	as that provided in s. 366.8255(1)(a).
40	(c)  "Integrated gasification combined cycle power plant"
41	or "plant" means an electrical power plant as defined in s.
42	403.503(14) that uses synthesis gas produced by integrated
43	gasification technology.
44	(d)  "Nuclear power plant" or "plant" means an electrical
45	power plant as defined in s. 403.503(14) that uses nuclear
46	materials for fuel.
47	(e)  "Power plant" or "plant" means a nuclear power plant
48	or an integrated gasification combined cycle power plant.
49	(f)  "Preconstruction" is that period of time after a site,
50	including any related electrical transmission lines or
51	facilities, has been selected through and including the date the
52	utility completes site clearing work. Preconstruction costs
53	shall be afforded deferred accounting treatment and shall accrue
54	a carrying charge equal to the utility's allowance for funds
55	during construction (AFUDC) rate until recovered in rates.
56	(2)  Within 6 months after the enactment of this act, the
57	commission shall establish, by rule, alternative cost recovery
58	mechanisms for the recovery of costs incurred in the siting,
59	design, licensing, and construction of a nuclear power plant,
60	including new, expanded, or relocated electrical transmission
61	lines and facilities that are necessary thereto, or of an
62	integrated gasification combined cycle power plant. Such
63	mechanisms shall be designed to promote utility investment in
64	nuclear or integrated gasification combined cycle power plants
65	and allow for the recovery in rates of all prudently incurred
66	costs and shall include, but not be limited to:
67	(a)  Recovery through the capacity cost recovery clause of
68	any preconstruction costs.
69	(b)  Recovery through an incremental increase in the
70	utility's capacity cost recovery clause rates of the carrying
71	costs on the utility's projected construction cost balance
72	associated with the nuclear or integrated gasification combined
73	cycle power plant. To encourage investment and provide
74	certainty, for nuclear or integrated gasification combined cycle
75	power plant need petitions submitted on or before December 31,
76	2010, associated carrying costs shall be equal to the pretax
77	AFUDC in effect upon this act becoming law. For nuclear or
78	integrated gasification combined cycle power plants for which
79	need petitions are submitted after December 31, 2010, the
80	utility's existing pretax AFUDC rate is presumed to be
81	appropriate unless determined otherwise by the commission in the
82	determination of need for the nuclear or integrated gasification
83	combined cycle power plant.
84	(3)  After a petition for determination of need is granted,
85	a utility may petition the commission for cost recovery of
86	prudently incurred costs as permitted by this section and
87	commission rules. The utility may begin recovery of such costs
88	through rates upon a determination by the commission that the
89	costs are prudent, provided that the approved rates shall not
90	become effective prior to January 1, 2011. Any rate currently in
91	effect that permits recovery of costs subject to this section
92	that the commission has not deemed prudent shall be adjusted to
93	remove the impact of such costs, and the utility shall refund to
94	its customers an amount equal to the costs removed, plus
95	appropriate interest, through a credit on customer bills.
96	(4)  When the nuclear or integrated gasification combined
97	cycle power plant is placed in commercial service, the utility
98	shall be allowed to increase its base rate charges by the
99	projected annual revenue requirements of the nuclear or
100	integrated gasification combined cycle power plant based on the
101	jurisdictional annual revenue requirements of the plant for the
102	first 12 months of operation. The rate of return on capital
103	investments shall be calculated using the utility's rate of
104	return last approved by the commission prior to the commercial
105	inservice date of the nuclear or integrated gasification
106	combined cycle power plant. If any existing generating plant is
107	retired as a result of operation of the nuclear or integrated
108	gasification combined cycle power plant, the commission shall
109	allow for the recovery, through an increase in base rate
110	charges, of the net book value of the retired plant over a
111	period not to exceed 5 years.
112	(5)  The utility shall report to the commission annually
113	the budgeted and actual costs as compared to the estimated
114	inservice cost of the nuclear or integrated gasification
115	combined cycle power plant provided by the utility pursuant to
116	s. 403.519(4), until the commercial operation of the nuclear or
117	integrated gasification combined cycle power plant. The utility
118	shall provide such information on an annual basis following the
119	final order by the commission approving the determination of
120	need for the nuclear or integrated gasification combined cycle
121	power plant, with the understanding that some costs may be
122	higher than estimated and other costs may be lower.
123	(6)  If the utility elects not to complete or is precluded
124	from completing construction of the nuclear power plant,
125	including new, expanded, or relocated electrical transmission
126	lines or facilities necessary thereto, or of the integrated
127	gasification combined cycle power plant, the commission shall
128	terminate the rates approved pursuant to this section with
129	respect to the abandoned project and order the utility to refund
130	to customers, as credits on customer bills, all amounts
131	recovered for the abandoned project. Credits shall be provided
132	in the same manner, at the same rate, and over the same period
133	of time in which the amounts were recovered. shall be allowed to
134	recover all prudent preconstruction and construction costs
135	incurred following the commission's issuance of a final order
136	granting a determination of need for the nuclear power plant and
137	electrical transmission lines and facilities necessary thereto
138	or for the integrated gasification combined cycle power plant.
139	The utility shall recover such costs through the capacity cost
140	recovery clause over a period equal to the period during which
141	the costs were incurred or 5 years, whichever is greater. The
142	unrecovered balance during the recovery period will accrue
143	interest at the utility's weighted average cost of capital as
144	reported in the commission's earnings surveillance reporting
145	requirement for the prior year.
146	Section 2.  This act shall take effect July 1, 2009.

CODING: Words stricken are deletions; words underlined are additions.