CopyCited 2 times | Published | Supreme Court of Florida | 38 Fla. L. Weekly Supp. 267, 2013 WL 1830919, 2013 Fla. LEXIS 886
...Specifically, the final order authorizes the utility companies to recover through customer rates the pre-construction costs of their respective new nuclear power plant projects under section 866.93, Florida Statutes (2010). We have jurisdiction. See art. V, § 3(b)(2), Fla. Const. SACE argues that section 366.93 unconstitutionally delegates legislative authority to the PSC and, alternatively, that the PSC’s order is arbitrary and unsupported by competent, substantial evidence....
...tent the [PSC] finds, based on a preponderance of the evidence adduced at a hearing before the commission under s.
120.57, that certain costs were imprudently incurred. Ch.2006-230, § 43, at 2647, Laws of Fla. The Legislature simultaneously created section
366.93(2), Florida Statutes (2006), to direct the PSC to “establish, by rule, alternative cost recovery mechanisms for the recovery of costs incurred in the siting, design, licensing, and construction of a nuclear power plant.” Ch.2006-230, § 44(2), at 2648, Laws of Fla....
...preconstruction costs pursuant to the above provisions. In one such order, the PSC ruled that “a utility must continue to demonstrate its intent to build the nuclear power plant for which it seeks advance recovery of costs to be in compliance with Section 366.93, F.S.” In Re Nuclear Cost Recovery Clause, Docket No....
...The PSC rejected that argument and in its final order authorized the utility companies to include the nuclear cost recovery amounts of $196,088,824 (FPL) and $85,951,036 (PEF) in establishing their respective 2012 capacity cost recovery factors. 2 See id. at *91. SACE now appeals. II. ANALYSIS Section 366.93, Florida Statutes (2010), is titled “[c]ost recovery for the siting, design, licensing, and construction of nuclear and integrated gasification combined cycle power plants,” and provides in pertinent part: (1) As used in this secti...
...eater. The unrecovered balance during the recovery period will accrue interest at the utility’s weighted average cost of capital as reported in the commission’s earnings surveillance reporting requirement for the prior year. SACE argues (1) that section 366.93 delegates legislative authority to the PSC in violation of the separation of powers clause of the Florida Constitution and, alterna *748 tively, (2) that the PSC’s finding that the utility companies demonstrated an intent to build for cost recovery purposes under the statute is arbitrary and unsupported by competent, substantial evidence. We reject both arguments. A. Separation of Powers The PSC did not, and indeed could not, rule on the constitutionality of section 366.93, Florida Statutes (2010)....
...We therefore consider this matter as one of first impression under the de novo standard of review. See generally Crist v. Ervin,
56 So.3d 745, 747 (Fla.2010) (recognizing that “[t]he constitutionality of a statute is a question of law subject to de novo review”). In so doing, we are obligated to accord section
366.93 a presumption of constitutionality and construe that statute to effect a constitutional outcome if possible....
...The statute must so clearly define the power delegated that the administrative agency is precluded from acting through whim, showing favoritism, or exercising unbridled discretion.” Lewis v. Bank of Pasco Cnty.,
346 So.2d 53, 55-56 (Fla.1976). 3 As applied here, the Legislature in section
366.93 made the fundamental and primary policy decision to “promote utility investment in nuclear or integrated gasifi-cation combined cycle power plants and allow for the recovery in rates of all prudently incurred costs.” §
366.93(2), Fla....
...[and] through an incremental increase in the utility’s capacity cost recovery clause rates of the carrying costs on the utility’s projected construction cost balance associated with the nuclear or integrated gasification combined cycle power plant.” § 366.93(2)(a)-(b), Fla. Stat. (2010); see also § 366.93(l)(a), (f), Fla....
...[it] considers relevant” in determining the public interest in licensing phone companies to engage in competition). The Legislature further specified that the mechanisms shall “allow for the recovery in rates of all prudently incurred costs.” § 366.93(2), Fla....
...SACE argues that “ ‘prudently incurred’ costs is not an objective standard which provides any real guidance for, and/or restrictions on, the [PSC’s] authority to determine how far it should go in promoting utility investment in nuclear power.” But the companion statute to section 366.93 illuminates by negative implication that “[p]roceeding with the construction of the nuclear or integrated gasification combined cycle power plant ......
...of critical state concern ... are constitutionally defective because they reposit in [an agency] the fundamental legislative task of determining which geo *751 graphic areas and resources are in greatest need of protection”). In sum, we find that section 366.93 is not “so lacking in guidelines that neither the agency nor the courts can determine whether the agency is carrying out the intent of the legislature.” Id....
...pprovals necessary to construct and operate the plants, performing work needed to support environmental permitting, continuing relevant negotiations, etc.) did not demonstrate their “intent to build” those plants for cost recovery purposes under section 366.93....
...The PSC ruled: Based upon our analysis of the applicable statute, our prior Orders, and prior Florida case law, we do not find that a utility must engage in the siting, design, licensing, and construction of - nuclear power plant activities simultaneously in order to meet the statutory requirements of Section 366.93, F.S. We note our decision in Order No. PSC-11-0095FOF-EI, where we found that a utility must continue to demonstrate its intent to build the nuclear power plant for which it seeks advance recovery of costs to be in compliance with Section 366.93, F.S....
...As discussed in that Order, we find that there are various phases of constructing a nuclear power plant, including the siting, design, licensing, and building of the plant. These phases generally cannot occur simultaneously. As stated in [the Order], Section 366.93(l)(f), F.S., contemplates that there are various phases of constructing a nuclear power plant by explicitly establishing demarcations of what is pre-construction and what is construction of a nuclear power plant. For example, Section. 366.93(l)(f), F.S., defines the word “preconstruction.” Under the statute: Preconstruction is that period of time after a site, including any related electrical transmission lines or facilities, has been selected through and including the date the utility completes site clearing work. Preconstruction costs shall be afforded deferred accounting treatment and shall accrue a carrying charge equal to the utility’s allowance for funds during construction (AFUDC) rate until recovered in rates. Furthermore, Section 366.93(2)(a), F.S., provides that recovery of any precon-struction costs will occur through the Capacity Cost Recovery Clause. Rule 25-6.0423(2)(h), F.A.C., which implements Section 366.93(l)(f), F.S., provides: Site selection costs and pre-construction costs include, but are not limited to: any and all costs associated with preparing, reviewing and defending a *752 Combined Operating License (COL) application for a nucl...
...d permitting the nuclear or integrated gasification combined cycle power plant; costs of clearing, grading, and excavation; and costs of on-site construction facilities (i.e., construction offices, warehouses, etc.). ... [A] strict interpretation of Section
366.93, F.S., to require a utility to engage in the siting, design, licensing, and construction of nuclear power plant activities simultaneously, would be an incorrect interpretation of the statute, and inconsistent with our precedent. Final Order,
2011 WL 5904236 , at *6-*7; accord id. at *72. The PSC in turn found the preconstruction costs at issue to be recoverable under section
366.93, thereby necessarily construing the statute to mean that preconstruction activities creating an option to build can demonstrate a utility company’s intent to build, and thus its eligibility to recover associated costs under the statute....
...Jacobs,
887 So.2d 1200, 1204 (Fla.2004). “This Court will approve the commission’s findings and conclusions if they are based upon competent, substantial evidence and are not clearly erroneous.” Id. Crist v. Jaber,
908 So.2d 426, 430 (Fla.2005). The PSC’s construction of section
366.93 is not clearly erroneous....
...As recognized by the PSC in its final order, subsections (l)(f) and (2)(a) of the statute together identify “preconstruction” as a distinct period of time in the process and specifically provide for the recovery of any prudent preconstruction costs. Accord § 366.93(6), Fla....
...a nuclear power plant in authorizing the PSC to establish mechanisms for recovery of costs, it in turn disjunctively defines the term “cost” as including expenses related to siting, licensing, design, construction, or operation of the plant. See § 366.93(l)(a) & (2), Fla....
...gether to harmonize the statutes and give effect to legislative intent). The operative statutes therefore support the PSC’s conclusion that utilities need not engage in siting, design, licensing, and construction simultaneously in order to satisfy section 366.93 and, by extension, that pre-construction activities creating an option to build can demonstrate a utility’s intent to build for cost recovery purposes under the statute....
...e such a “final decision” and indeed contemplates that “[i]f the utility elects not to complete ... construction of the nuclear power plant, ... [it] shall be allowed to recover all prudent preconstruction and construction costs incurred!.]” § 366.93(6), Fla....
... approach,” and acknowledged SACE’s concern that it “could be interpreted as [the utility] not intending to actually construct” the plant. Final Order,
2011 WL 5904236 , at *7. But the PSC rejected this interpretation and instead construed section
366.93 to mean that pre-construction activities creating an option to build can demonstrate a utility’s intent to build and, in turn, its eligibility to recover its associated costs under the statute....
...See Final Order,
2011 WL 5904236 , at *5-*7, *72-*76. SACE acknowledges as much and, as addressed above, we reject its argument that such evidence cannot demonstrate the utility companies’ intent to build the plants so as to be eligible to recover costs under section
366.93....
...Our task is to determine whether competent substantial evidence supports a PSC order.” Gulf Power Co. v. Fla. Pub. Serv. Comm’n,
453 So.2d 799, 803 (Fla.1984). Having determined so in the present case, we affirm on this issue. III. CONCLUSION SACE argues that section
366.93 “has had the dramatic effect of transferring all risk for proposed nuclear projects of Florida utilities away from utility shareholders and onto the utility’s ratepayers, giving the utilities a blank check to risk billions of dolla...
...ants at issue. See Final Order,
2011 WL 5904236 , at *8-*15, *64-*69. We also note that SACE’s concern amounts to a policy consideration best addressed by the Legislature, not this Court. Our role in this ease is to address SACE’s arguments that section
366.93 unconstitutionally delegates legislative authority to the PSC and, alternatively, that the PSC’s order is arbitrary and unsup *754 ported by competent, substantial evidence....
CopyPublished | Florida 2nd District Court of Appeal | 2014 Fla. App. LEXIS 20925, 40 Fla. L. Weekly Fed. D 77
...Bevington, and Kevin W.
Cox of Holland & Knight, LLP,
Tallahassee, for Appellees.
KELLY, Judge.
The appellants, customers of Duke Energy Florida, Inc., and Florida
Power & Light Company (the Utilities), brought suit against the Utilities challenging the
constitutionality of sections
366.93 and
403.519, Florida Statutes (2012), and seeking a
refund of monies paid under the statutes. They appeal from the trial court's order
dismissing the action with prejudice. We affirm.
In 2006, the Legislature enacted section
366.93, Florida Statutes, and
amended section
403.519, Florida Statutes,1 with the stated purpose of encouraging
utility companies to invest in new nuclear power plants....
...and only to the extent the
commission finds, based on a preponderance of the
evidence adduced at a hearing before the commission under
s.
120.57, that certain costs were imprudently incurred.
Section
366.93(2), Florida Statutes (2012), retains the same language as
the 2006 version of the statute and directs the Florida Public Service Commission
(PSC) to "establish, by rule, alternative cost recovery mechanisms for the recovery of
costs in...
...plant from its customers. See S. Alliance For Clean Energy v. Graham,
113 So. 3d 742,
745 (Fla. 2013). However, the 2006 legislation allows public utilities to recover
preconstruction and carrying costs before a nuclear power plant begins to operate.
Section
366.93(6) provides in pertinent part:
If the utility elects not to complete or is precluded from
completing construction of the nuclear power plant, including
new, expanded, or relocated electrical t...
...r
granting a determination of need for the nuclear power plant
and electrical transmission lines and facilities necessary
thereto or for the integrated gasification combined cycle
power plant.
§ 366.93(6), Fla....
... granted the Utilities' motion and dismissed the second amended complaint with
prejudice.
The second amended complaint contained two counts, only one of which
is at issue in this appeal. In that count the appellants allege that sections
366.93 and
403.519 are facially unconstitutional under Article I, Section 10 of the Constitution of the
United States....
