THE TAMPA TRIBUNE

Utilities take case against merchant plants to justices

Florida utilities on Wednesday attacked a giant energy company's proposal to build a power plant in the state, calling it illegal.

State law does not allow independent electric companies, such as Duke Energy Corp., of Charlotte, N.C., to build power plants without having customers to serve, utilities' attorneys told the state Supreme Court.

Duke Energy wants to build a wholesale power plant, which would sell electricity to utilities and municipalities - not directly to consumers' homes and businesses.

Florida utilities opposing wholesale plants repeated their claim that the Florida Legislature, not regulators, should decide the level of competition in the wholesale electricity market.

``You cannot simply build plants willy-nilly all over the state of Florida,'' said Alvin Davis, the attorney for Florida Power & Light, of Juno Beach, the state's largest utility.

``If you're going to build a plant, you have to show that you ... need that plant to serve existing customers,'' he said.

FP&L was joined by Tampa Electric Co. and Florida Power Corp. They asked the Supreme Court to overrule the Florida Public Service Commission's approval of Duke's proposed $160 million plant near New Smyrna Beach.

Since Duke's plan was approved 11 months ago, five other companies have proposed building or buying seven wholesale plants in the state.

Wholesale power plants also are called merchant plants because they sell most of their power on the open market instead of through long-term contracts.

Other merchant-plant developers are awaiting the Supreme Court's ruling to determine whether they will build their plants.

Rulings take an average of six months, said Supreme Court spokesman Craig Waters. It is the utilities' last opportunity for appeal.

After the court's ruling, the governor and Cabinet, serving as the Power Plant Siting Board, also will vote on the issue.

One reason utilities fear merchant plants is deregulation, which is opening the retail electricity market to competition so consumers have a choice of who provides them with power. Utilities fear merchant plants will have a competitive advantage if the industry is deregulated.

Cherie Jacobs Lane covers utilities and can be reached at (813) 259-7668 or at cjacobslane@tampatrib.com