The Pennsylvania Public Utilities Commission today gave General Public Utilities permission to charge its customers for 85 percent of the electricity it must buy to replace lost output from its damaged Three Mile Island nuclear plant.
General Public Utilities had asked the commission for a rate increase that would have let it recover 94 percent of the higher cost of purchasing electricity from other utilities.
The company estimates that its three subsidiaries, Metropolitan Edison, Pennsylvania Electric and Jersey Central Power & Light, are paying $24 million a month to buy electricity for its customers to replace the lost output from Three Mile Island.
The decision today covers Pennsylvania Electric and Metropolitan Edison. Monday, the New Jersey Board of Public Utilities is scheduled to make a decision on Jersey Central's request for a $113 million rate increase to cover its share of the higher electric bills.
The decisions are crucial to the company's efforts to obtain $400 million in bank financing to help it recover from the March accident at Three Mile Island. The banks are supposed to decide Tuesday whether to lend the money.
General Public Chairman William Kuhns said he was disappointed by the action today, but a spokesman for the company declined to say whether the utilities will operate at a loss as a result of the decision.
However, General Public stock closed up 50 cents a share today after the news that the Pennsylvania commission had granted the company partial rate relief.
There are two nuclear reactors at Three Mile Island, and although one of them was damaged in the accident last March, both have been shut down while investigators try to determine what went wrong.
General Public Utilities has cut back on construction, reduced some salaries and slashed its dividend to help pay for the Three Mile Island accident.