ATLANTA — The United States Court of Appeals for the Eleventh Circuit affirmed a district court’s decision in favor of Duke Energy Florida and Florida Power & Light Company in a putative class-action lawsuit.
This week, the appellate court upheld the U.S. District Court for the Southern District of Florida’s judgment in a case concerning utility companies raising rates to fund nuclear plant construction.
The plaintiffs, William Newtown and Noreen Allison, argued against the increase in utility rates charged to Duke Energy Florida and Florida Power & Light Company customers under the Florida Renewable Energy Technologies and Energy Efficiency Act (Florida’s Energy Act). The act led to the creation of the Nuclear Cost Recovery System (NCRS), which allows for utility companies to raise electric utility rates in order to fund the creation of nuclear power plants, with the company keeping these funds even if the project is not completed.
The plaintiffs appealed the district court decision, arguing that they sufficiently established both their preemption claim under the Atomic Energy Act of 1954 and their Dormant Commerce Clause (DCC) claim.
According to the plaintiffs, the Atomic Energy Act preempts the NCRS by making the federal government the only entity with the ability to oversee the construction of nuclear plants.
“Plaintiffs point to no cases holding (nor authorities suggesting) that state laws promoting investment in new nuclear plants, or shifting the costs of nuclear plant construction, are preempted by the Atomic Energy Act,” the appellate court said.
The court of appeals affirmed the district court’s decision that the NCRS is not preempted by the Atomic Energy Act.
The plaintiffs claimed that the utility companies were in violation of the DCC as the companies were improperly impacting interstate commerce. The court of appeals affirmed the district court decision to dismiss these claims, as the plaintiffs are Florida customers and the utility companies are Florida companies and not states.
“Plaintiffs’ interests are well beyond the zone the DCC is meant to protect,” the court of appeals stated.