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Progress Energy Gets OK To Reduce Rate

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By RUSSELL RAY

rray@tampatrib.com

Published: March 18, 2009

TAMPA - State regulators on Tuesday granted Progress Energy's request to cut electric bills by 11 percent, or $400 million, this year.

Beginning in April, the cost of 1,000 kilowatt hours will be reduced by $15.08, to $122.79. For the average residential customer using 1,200 kilowatt hours a month, the decrease comes to $18.09.
Progress Energy sought the reduction from the Public Service Commission based on lower fuel cost projections for 2009 and a sour economy that is squeezing the pocketbooks of many consumers.

In addition to lowering fuel charges, the utility will delay the collection of most preconstruction costs for its proposed nuclear plant in Levy County.

Progress began recovering preconstruction costs for the nuclear plant in January, adding $11.42 to the cost of 1,000 kilowatt hours. That charge will be reduced to $3.62 under the plan approved Tuesday by the PSC.

The company had planned to collect nearly $400 million this year for costs related to the construction of the nuclear plant. It now will collect about half that amount this year.

"We've listened to our customers and lowered our price to provide some short-term help," said Jeff Lyash, president and chief executive of Progress Energy Florida.

The utility plans to ask regulators this year for an increase in base service rates for 2010. The company says it needs to increase base rates by at least $475 million annually to pay for improvements to power plants, power lines and substations.
Progress Energy is Central Florida's largest power provider, serving more than 1.6 million customers in 35 counties.

Reporter Russell Ray can be reached at (813) 259-7870.

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