Over opposition of JEA, major purchaser of future Vogtle generation, and despite project being uneconomic for customers continue
Atlanta, Ga. – After days of heated wrangling, all four co-owners in the Vogtle nuclear expansion project – Georgia Power (a subsidiary of Southern Company), Municipal Electric Authority of Georgia (MEAG Power), Dalton Utilities, and Oglethorpe Power – have voted to continue with the only remaining nuclear power project in the U.S. These utilities provided little explanation in their statements about today’s announcement, but some details are provided in the SEC filing. The mismanaged project is still only half complete after nine years of construction, more than five years delayed, and has doubled from the original $14 billon cost projection to some estimates approaching $30 billion.
The vote was prompted by a $2.3 billion increase in the project announced in August, just eight months after another multi-billion cost increase was approved by the Georgia Public Service Commission (PSC), ignoring their own Staff’s recommendations and that of other interveners, including the Southern Alliance for Clean Energy (SACE).
“We’re very concerned about today’s announcement because it’s clear the Plant Vogtle nuclear project is in serious trouble if this much arm twisting is necessary to keep all four partners at the table,” said Dr. Stephen A. Smith, executive director of Southern Alliance for Clean Energy. “The project details are not fully understood, but Georgia’s ratepayers and energy consumers have every right to know exactly what’s happening with this project before the November elections. With so little transparency, consumers better hold onto their wallets because more costs are coming your way.”
“We are still evaluating this new information, but on first blush it appears that Georgia ratepayers will face more risks with this project going forward than ever before,” said Sara Barczak, regional advocacy director with Southern Alliance for Clean Energy. “Utility regulators need to fully vet this deal before the November elections as this project appears to be in serious trouble and the Department of Energy should not finalize billions of additional taxpayer-backed federal loan guarantees due to the ongoing fiscal risks of this project.”
Georgia Power’s 19th semi-annual Vogtle Construction Monitoring report references an additional $1.1 billion cost increase to $8.3 billion (this includes a $1.493 billion reduction from the Toshiba Parent Guarantee) to complete Georgia Power’s portion of the project as 45.7%, which represents more than a doubling of the original certified capital cost estimate of $4.418 billion. Georgia Power’s estimated financing costs are $3.2 billion, up significantly from the original $1.695 billion estimate. Originally the two reactor units should have been online respectively in April 2016 and April 2017 and current Company estimates, which the PSC PIA Staff could not verify in the 18th VCM as they did not receive the resource loaded fully integrated project schedule in time to review, are November 2021 for unit 3 and November 2022 for unit 4.
Over $2.2 billion in pre-collected financing costs have been charged to ratepayers due to anti-consumer state legislation passed in 2009 to incentivize building new reactors. Georgia Power is 45.7% owner in the project and remaining utility partners are Oglethorpe Power (30%), MEAG (22.7%) and the City of Dalton (1.6%). SACE determined the disproportionate burden due to pay-in-advance payments the Vogtle project has had on residential customers in comparison to large industrial users. Residential customers are currently paying over 0.7 cents/kWh, while industrial customers pay less than 0.2 cents/kWh. Over the first six years of these mandatory nuclear plant construction financing fees, residential customers have paid 45% more than average (on a per kWh basis), while industrial customers have enjoyed a 58% below average rate.