Duke Energy Seeks to Ensure Cost Recovery for the Evaluation and Development of New Nuclear Plant
CHARLOTTE – Duke Energy has filed documents with the North Carolina Utilities Commission seeking to ensure the recovery in future electric rates of its investment to evaluate and develop an advanced new nuclear power plant in the Carolinas.
“Nuclear power supplies our customers in the Carolinas with approximately half of their electricity and is a primary reason why our electric rates are below the national average,” said Ellen Ruff, president of Duke Energy Carolinas. “The intent of this request is to ensure that we can continue to fund the development and permitting of a new nuclear power plant, which will help maintain our competitive rates, grow our economy and help minimize overall greenhouse gas emissions as we continue to work to address climate change.
“As the application notes, we intend to work with the commission to seek a legislative remedy if the commission concludes it does not have the statutory authority to grant our request,” Ruff added.
Duke Energy expects to invest approximately $125 million before the end of 2007 to develop the proposed William States Lee III Nuclear Station in Cherokee County, S.C., which will be jointly owned with Southern Company. Duke Energy is preparing a Combined Construction and Operating License (COL) application for the potential plant and will decide whether to submit the application to the Nuclear Regulatory Commission by the end of 2007. The decision to build the plant, projected to cost between $4 and $6 billion, is scheduled to be made by the end of 2010. The plant could begin electricity production in 2016.
While nuclear power has relatively high development and construction costs, its low fuel costs make it a less expensive way to produce electricity over the long term compared to coal, natural gas or oil-fueled power plants.
Duke Energy is adding between 40,000 and 60,000 new customers annually in the Carolinas. To serve this growing demand, the company is also pursing new highly efficient coal units at its existing Cliffside Steam Station. In addition, the company is pursuing energy efficiency and demand reduction programs to help reduce the amount of electricity needed to supply customers and slow down the need for new power plants.
“Our long-term strategy is focused on ensuring that we maintain a diverse portfolio of resources to meet customers’ needs and not ‘put all our eggs in the same basket’ as we prepare for the future and make long-term investments to serve our customers,” said Ruff. “Nuclear power is a very important component of this diverse portfolio. In order for us to make the substantial investments necessary to evaluate and ultimately develop an advanced new nuclear plant, it is necessary for us to have assurance that we can recover these costs from customers through our electric rates.”
Duke Energy is a diversified energy company with a portfolio of natural gas and electric businesses, both regulated and unregulated, and an affiliated real estate company. Duke Energy supplies, delivers and processes energy for customers in the Americas, including 28,000 megawatts of regulated generating capacity in the United States. Duke Energy’s Carolinas operations include a diverse mix of nuclear, coal-fired, natural gas and hydroelectric generation that provides 19,900 megawatts of safe, reliable and competitively priced electricity to more than 2.2 million electric customers in a 22,000 square mile service area of North Carolina and South Carolina. Headquartered in Charlotte, N.C., Duke Energy is a Fortune 500 company traded on the New York Stock Exchange under the symbol DUK. More information about the company is available on the Internet at: www.duke-energy.com.