Progress Energy Awarded Nearly $83 Million in Spent Fuel Ruling

RALEIGH, N.C., May 21  /PRNewswire-FirstCall/ -- The U.S. Court of Federal Claims issued a ruling on Monday, awarding Progress Energy $82.8 million for costs incurred as a result of the government's failure to accept spent nuclear fuel from the utility. The sum covers the costs incurred by Progress Energy to activate fuel storage facilities at plants in the Carolinas and costs to transfer used nuclear fuel between plants for storage.

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The lawsuit stemmed from the U.S. Department of Energy's failure to open a federal repository for used nuclear fuel by Jan. 31, 1998, as stipulated under federal law.

Since storage facilities were not opened by the appointed date, Progress Energy had to revise plans to include onsite storage at its nuclear power plants. Progress Energy originally filed the complaint against the DOE asserting $91 million in costs incurred between January 31, 1998 and December 31, 2005 - the time period established by the court for the complaint. Costs incurred after 2005 can be recovered in future claims.  The trial was conducted in November 2007 and April 2008.

Approximately 60 similar cases have been litigated between utility companies and the federal government. Some of the suits have been settled. A number of cases are still pending.

Progress Energy operates five reactors at four sites in the Carolinas and Florida. Nuclear energy accounted for about 35 percent of the company's total energy produced for customers in 2007. The company has the capability to continue to store used nuclear fuel rods safely on site at each plant. Meanwhile, the company continues to be a strong advocate for a permanent federal storage solution for the nation's nuclear reactors.

"Nuclear energy is going to continue to be a critical part of our ability to meet the needs of our growing service areas," said Bill Johnson, Progress Energy's Chairman, President and CEO. "Nuclear power will be one means of addressing global climate change while ensuring a reliable energy supply for future generations, and as a country we must address the issue of used nuclear fuel with a clear national policy based on scientific and engineering facts."

The Department of Justice can appeal Monday's decision within the next 60 days. Given the likelihood of an appeal, no decision has been made regarding the disposition of the potential court award.

Progress Energy, headquartered in Raleigh, N.C., is a Fortune 250 energy company with more than 21,000 megawatts of generation capacity and $9 billion in annual revenues. The company will observe its 100th anniversary in 2008. Progress Energy includes two major utilities that serve 3.1 million customers in the Carolinas and Florida. The company is the 2006 recipient of the Edison Electric Institute's Edison Award, the industry's highest honor, in recognition of its operational excellence. The company also is the first utility to receive the prestigious J.D. Power and Associates Founder's Award for customer service. Progress Energy serves two growing areas of the country. For more information about Progress Energy, visit the company's Web site at http://www.progress-energy.com/.

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DATASOURCE: Progress Energy



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