Despite much uncertainty including increasing financial impacts to customers, utility ignores project cancellations by other regional electric utilities
Contact: Jennifer Rennicks, SACE, 865.235.1448
Atlanta, Ga. (August 31, 2017) ///PRESS RELEASE/// Southern Company and its utility partners have proposed to continue forward with the massively over-budget and much-delayed nuclear expansion project at Plant Vogtle in Burke County Georgia along the Savannah River, despite the recent cancellation by SCE&G and Santee Cooper of the only other nuclear reactor construction project in the country, the V.C. Summer plant in neighboring South Carolina. Uncertainly looms in the wake of the Westinghouse bankruptcy, the designer and builder of the AP1000 reactor design, and parent company Toshiba’s continued financial uncertainly given the multi-billion dollar losses because of the Vogtle and V.C. Summer reactor projects. The total project cost is now estimated at more than $25 billion.
Today Southern Company filed more details with the Security and Exchange Commission (SEC) and filed the 17th semi-annual Vogtle Construction Monitoring report with the Georgia Public Service Commission (PSC). The monitoring report mentions an additional $4.5 billion capital cost estimate to complete Georgia Power’s portion of the project as 45.7% owner and a total capital cost estimate of $9.45 billion to complete the project, which represents more than a doubling of the original capital cost estimate. The report estimates increased financing costs to $3.4 billion bringing Georgia Power’s share of the project for capital and financing costs to $12.2 billion, a doubling of the original $6.1 billion. The completion schedule is also significantly delayed, again. Originally the two reactor units should have both been online in April 2016 and April 2017 and new Company estimates are November 2021 for unit 3 and November 2022 for unit 4.
The report includes cost estimates for cancelling the project: “between $730 million and $760 million, of which Georgia Power’s share is estimated to be approximately $330 million to $350 million exclusive of estimated credits from the salvage and sale of assets.”
The Vogtle monitoring report requests that the Georgia PSC approve the new estimated schedule and cost to complete the Vogtle reactors and highlights a number of items that must occur in order for the project to continue moving forward, such as receiving the $3.68 billion Toshiba Parental Guarantee, Congress expanding the federal taxpayer-backed loan guarantee of which the project has already benefitted from $8.3 billion and extension of the Production Tax Credits deadline. The Georgia PSC is expected to make a decision on these matters by February 2018.
Below are statements from the Southern Alliance for Clean Energy’s Executive Director, Dr. Stephen A. Smith, and High Risk Energy Choices Program Director, Sara Barczak. Southern Alliance for Clean Energy (SACE) has a long history tracking the Vogtle project and was an intervening party in the original certification proceeding, all semi-annual Vogtle Construction Monitoring reviews and the Vogtle Supplemental Information Review process in 2016, which the clean energy organization criticized as a limited, expedited and non-transparent proceeding.
From Dr. Stephen A. Smith, Executive Director of the Southern Alliance for Clean Energy:
“Southern Company’s decision is an anomaly, a very expensive one. Even as every other utility realized the extreme risks to their shareholders and customers and correctly decided to stop the financial bleeding, Southern stubbornly presses forward. It’s imperative that Georgia regulators at the Public Service Commission conduct an open and transparent process and protect ratepayers from these unfair financial burdens — ensuring that all additional risks be borne by the Company and its shareholders. Further, the Vogtle project has already benefitted from many billions of dollars in federal taxpayer funded incentives – not one more dollar should be doled out to this project at taxpayers’ expense.”
From Sara Barczak, High Risk Energy Choices Program Director for the Southern Alliance for Clean Energy:
“For many years, the warning signs were overlooked by federal and state decision makers and Georgia Power, its partners and shareholders and former lead contractor Westinghouse were wrongly rewarded for years and years of mistakes that will cost utility customers billions of additional dollars. Now Southern Company and its partners want even more from their customers and the federal government to keep this project afloat. The still under-construction nuclear reactors at Plant Vogtle represent a financial disaster of epic proportions with no assurance that they will ever be complete. Today’s updated information underscores that the situation will get even worse given the higher price tag and longer completion schedule unless regulators stand up and protect Georgians and federal taxpayers from additional financial harm.”
Originally Vogtle reactor Unit 3 was scheduled to come online April 1, 2016 and Unit 4 one year later. The current certified cost for Georgia Power’s share of the project is approximately $6.113 billion, which represented an original $4.418 billion for capital costs and $1.695 billion in financing costs. Over $1.9 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%).
Find filings with the Georgia PSC in the semi-annual Vogtle Construction Monitoring review docket here.
Find more information about Plant Vogtle here.
Founded in 1985, the Southern Alliance for Clean Energy promotes responsible energy choices that work to address the impacts of Global Climate Change and ensure clean, safe, and healthy communities throughout the Southeast. Learn more at www.cleanenergy.org.