The Florida Public Service Commission on Friday approved rate hikes for Progress Energy Florida and Florida Power & Light customers.

The PSC said it approved the agencies’ cost-recovery requests “to continue investment in nuclear electric generation, and for upgrades of existing generating units.” Customers will see the effect of the rate hikes, called “capacity cost recovery” on their power bills, beginning next year.

FPL’s approved $62,676,816 cost recovery includes costs associated with the upgrade of its existing nuclear generating plants, Turkey Point Units 3 and 4 and St. Lucie Units 1 and 2, and the construction of its proposed nuclear power plants, Turkey Point Units 6 and 7. These completed projects will add 2,614 megawatts (MW) of new nuclear base load generation to FPL’s system, enough energy to power 1.4 million homes.

PEF’s approved $206,907,726 cost recovery includes costs associated with the upgrade of its existing nuclear generating plant at Crystal River, and the construction of its proposed nuclear power plants, Levy Units 1 and 2. These completed projects will add 2,380 MWs of new nuclear base load generation to Progress Energy’s system, enough energy to power 1.3 million homes.

“Nuclear power provides fuel diversity and will save Florida residents money on future utility bills,” said PSC Chairman Matthew M. Carter II. “The Legislature enabled utilities to plan for tomorrow by spreading the rate impact over time. Utilities have to begin spending now to meet future power needs that will keep the lights on for us, our children, and our grandchildren at prices we can afford.”

Customers of those utilities could be tapped for even more money in January, when the PSC will vote on base-rate increases for FPL and PEF.

With Friday’s decision, FPL’s customers are projected to pay about 67 cents per month for the first 1,000 kilowatt hours, the PSC says, and PEF’s customers will pay about $5.86 per month. The final approved amount for customer bills, however, will be determined after the PSC’s decision in the annual fuel cost recovery clause hearing beginning Nov. 2.

The Florida Legislature enacted a law in 2006 to encourage the development of nuclear power by permitting cost recovery for some nuclear plant project costs during the construction process. The PSC then adopted a rule on how it evaluates those costs annually. The PSC held its annual nuclear cost recovery hearings Sept. 8-10, where commissioners heard testimony from the utilities, consumer groups and the public.

Before their final vote, Gov. Charlie Crist on Oct. 1 announced two commissioners would be replaced, and that the new commissioners would begin their terms on Jan.2. Replaced will be Katrina McMurrian and PSC Chairman Matthew Carter. Their chairs will be taken by former newspaperman David Klement and former Escambia County Sheriff’s Office financial executive Benjamin Stevens. McMurrian offered to resign immediately, which initiated an immediate search for an interim replacement.

A controversial vote over Florida Power & Light’s $1.3 billion base-rate hike request, and PEF’s request for a base-rate hike of about $500 million, is slated for Jan. 11, just a few days after Klement and Stevens take their chairs on Jan. 2. Crist has said he expects the new commissioners will study hard ahead of the rate-hike decision.

Klement and Stevens will serve four-year terms, which will expire on Jan. 1, 2014.

Fast Fact:

• Read more about Crist’s decision and commissioners’ reactions