Duke Energy sues Westinghouse for $54 million

Duke Energy says Westinghouse Electric owes it $54 million after Duke canceled a contract for the Levy County nuclear plant in Florida.

Westinghouse was to provide two AP1000 nuclear plants for the site, which Duke put on indefinite hold last year. Duke says it paid Westinghouse for work that was never performed before the project was suspended.

The federal lawsuit Duke Energy Florida filed Friday also describes a far larger disagreement between the two – nearly $500 million that Westinghouse claims Duke owes in contract termination costs.

Neither company would comment on the litigation Monday.

Duke said last August that it would cancel the engineering and construction contract for the Levy County plant in part because of licensing delays by the Nuclear Regulatory Commission. The plant had been expected to cost up to $24 billion.

Under a settlement the Florida Public Service Commission approved in October, Duke was allowed to pass to customers $350 million to wind down the Levy contract. The settlement added $3.45 a month to customers’ bills through 2017.

Ratepayers not on the hook

Florida’s Office of Public Counsel, which advocates for consumers, said ratepayers won’t be on the hook to pay for any lawsuit judgments that result from the cancellation.

Duke also retired its one operating nuclear plant in Florida, Crystal River. Botched repairs led to concrete problems in the reactor containment building.

The contract said either side could end the agreement if the NRC didn’t grant a construction and operating license by Jan. 1, the lawsuit states. That deadline passed without a license, although Duke has said it will continue to pursue one.

Duke canceled the contract in late January.

The lawsuit says Duke had paid Westinghouse $54.1 million for turbine generators and reactor vessel parts that were never produced. Duke had suspended most work on the project in 2009 and now wants a refund.

Duke also claims that Westinghouse has demanded $482 million in reimbursement for costs related to winding down the contract. Duke says it has paid $65 million but owes Westinghouse nothing more.

The lawsuit asks U.S. District Judge Max Cogburn to award Duke the $54 million refund and issue a ruling establishing the parties’ rights to settle the termination costs.