Progress Energy bills to spike 18 percent by January

Progress Energy bills could increase by more than 18 percent by January as the utility piles on costs for fuel, upgrades and its $17-billion nuclear project in Levy County. Residential customers could be looking at an increase of more than $21 a month.

Customers could face an 8 percent increase as early as August because of soaring fuel costs. The St. Petersburg-based utility asked state regulators today for a mid-year increase in fuel charges of more than $12 per 1,000 kilowatt hours. If approved, customers will start seeing the charge in August. Progress Energy’s average residential customer uses about 1,178 kilowatt hours a month.

Progress Energy also plans to tack on charges for scrubbers installed on its Crystal River coal plant, a fuel switch to natural gas at its Anclote power station, and an "uprate" at its Crystal River nuclear plant that will increase its electric output. The utility has also asked state regulators to approve a $17-billion nuclear project in Levy County, several miles north of Crystal River. If approved, that project could add $7.53 per 1,000 kilowatt hours starting in January. The Public Service Commission is expected to decide the nuclear case in mid-July.

The utilities don’t profit from fuel. It’s a direct pass-through to consumers. Each year, the utilities predict their fuel costs, and the Florida Public Service Commission approves how much the utility can recover through monthly bills. Utilities can ask for a mid-year correction if their annual estimate was widely off. In some years, utilities pay less and customers get the money back.

But that won’t happen this year, as fuel costs surge.

Progress Energy bills have been steadily increasing since 2003 (see chart at left), largely driven by the soaring cost of fuel. This year, power plants will pay 54 percent more for fuel oil, 33 percent more for natural gas and 6 percent more for coal, predicted the Energy Information Administration, the statistical arm of the Energy Department. Spot prices also have risen sharply.

Last week, Florida Power & Light president Armando Olivera told the Palm Beach Post that fuel prices had pushed the utility’s energy bill up by $400-million.

In a press release issued at noon today, Progress Energy focused on the net impact to customer bills rather than the total fuel impact. The net impact will be $8.68 per 1,000 kilowatt hours. The fuel charge will be partially offset by the deletion of a storm surcharge of $3.61 per 1,000 kilowatt hours.

“Rising fuel prices are a global issue that is felt by everyone who uses energy or drives a car,” said Jeff Lyash, president and CEO of Progress Energy Florida, in the press release. “We know that these expenses are a burden on our customers."

“It’s like everything else,” said Deidra K. Honeywell, who lives in Largo, worried about the impact the increase would have on a spa she’s opening on Ulmerton Road. “Everybody’s food is going up, gas is going up and insurance is going up. And for people on a fixed income, it’s really tough. And even if you’re not on a fixed income, you have less money to spend on other stuff, like clothes or other things the president wants us to buy to stimulate the economy.”

-Asjylyn Loder, Times Staff Writer