ST. PETERSBURG, Fla. (AP) -- The largest utility in the U.S. is scuttling plans to build a $24.7 billion nuclear power plant in a small Gulf Coast county in Florida, the company announced Thursday.
Duke Energy Corp. said it made the decision because of delays by the Nuclear Regulatory Commission in issuing licenses for new plants, and because of recent legislative changes in Florida.
But Duke did not close the door entirely on the Levy County project. The Charlotte, N.C. -based company said it will still to pursue a NRC license for the plant — something Duke could receive in late 2014 or 2015, said Alex Glenn, Duke Energy's state president in Florida.
"We continue to believe that the Levy site is a viable option for future nuclear generation and we want to keep that option open," he said.
But Duke would have to evaluate energy factors before deciding whether "new nuclear generation makes sense."
"You have to look at project cost. You have to look at what are the energy needs in our service territory. You have to look at carbon regulations. Is there a carbon regulation? Is there a carbon tax? You have to look at - for the long term - what do you think natural gas prices are going to do. And I think we have to look at existing and future legislative provisions for cost recovery," Glenn said.
The announcement comes just a few years after U.S. nuclear industry executives said they were on the cusp of a revival. That revival fell short as new technology allowed drillers to tap more natural gas within the United States, which increased supplies and pushed down prices.
The proposed plant — and how the company was raising money for it — have been debated for some time in Florida.
Duke has been charging its customers nuclear cost recovery fees for the two, planned 1,100-megawatt nuclear units in Levy County. Through these fees, Duke customers have paid $1.5 billion for the plant so far.
Florida State Rep. Mike Fasano, R-Pasco County, said Thursday that he wasn't surprised by Duke's announcement.
"I've been saying for years that Duke had no intention of building these power plants yet they continue charging the customers for it," Fasano said. He's tried for several years to repeal the cost recovery fee.
The state's Public Service Commission and the state legislature should have "been more aggressive" with Duke and asked more questions, he said.
Duke's stocks were up 51 cents to $71.51 a share Thursday.
In February, Duke decided to close the Crystal River nuclear plant in Florida after workers cracked a concrete containment building during an attempt to upgrade the plant in 2009. An attempt to fix the problem in 2011 resulted in more cracks.
Ryan Bell, the chairman of the Levy County Commission, said he is optimistic that a plant will eventually be built in his county — and bring jobs and tax revenue with it.
"I personally have confidence," said Bell. "My opinion is that it's a tabled project, on hold, but not an indefinite hold. I would hope the world outside of Levy County would see the need for the jobs as well as another type of clean power."
In states where utilities operate as monopolies, they are reluctant to ask their regulators for permission to build enormously expensive nuclear plants, or even fix old ones, when building gas-fired factories is so cheap. In places where utilities sell power into the open market, the low prices don't counter the financial risk of building expensive nuclear plants.
Two brand-new nuclear plants are under construction in Georgia and South Carolina that use the same reactor design that had been proposed for the Levy County plant. Separately, the Tennessee Valley Authority is finishing a previously abandoned nuclear plant at its Watts Bar plant. Utility companies have struggled to contain costs on all three construction projects.
Meanwhile, utilities have shuttered older plants. In June, Southern California Edison announced it would close its San Onofre plant rather than fix damaged equipment that critics said could never be safely replaced. The two reactors were idled in January 2012, when a small radiation leak led to the discovery of unusual damage to hundreds of new tubes carrying radioactive water.
Dominion Resources Inc. announced late last year it would close the Kewaunee Power Station in Wisconsin because it couldn't find a buyer.
Weiss reported from Charlotte, N.C. Associated Press writer Ray Henry contributed to this report from Atlanta.
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