Staff at the Georgia Public Service Commission (PSC) believe the Plant Vogtle nuclear expansion project is too costly to finish – by $1.6 billion — unless regulators mandate Georgia Power and parent Southern Co. absorb some of the ever-growing costs.
In a document filed with the PSC Dec. 1, the staff said Georgia Power’s now $12.2 billion projected costs for its 45.7% share of the project are too much for customers to bear.
The commission must take steps to ensure that the reactors — now the only ones in the nation under construction — make economic sense to finish, or they should cancel the project, staff said.
Staff said it was opposed to Georgia Power/Southern shifting “most of financial risk of the project to customers,” according to the 38-page report, reviewed by Kallanish Energy.
In addition, PSC staff said Georiga Power/Southern were changing the parameters for determining whether or not to continue the massive project.
The future of Vogtle’s two-reactor construction project has been unsure since March 29, the date the project’s primary contractor, Westinghouse Electric, filed for Chapter 11 bankruptcy protection.
The project was already years behind schedule and billions of dollars above its forecast budget, and Georgia Power’s analysis has added time and money to that, Energy & Environment reported.
A similar project in South Carolina, the Summer project, was canceled by its backers earlier this year.
“Assuming the project is completed, ratepayers would incur significantly higher revenue requirements and a reduced economic benefit while the company’s profits would increase,” wrote PSC staff consultants Phil Hayet and Lane Kollen, and Tom Newsome, the PSC staff’s utilities finance director.
Georgia Power has argued the delays and cost increases at Vogtle are not the company’s fault, that schedule changes primarily are due to increased federal safety standards and contractor problems.
Staff, however, pointed to Georgia Power’s mismanagement of Vogtle and its contractors, specifically Westinghouse.
“The company’s failure to manage the project in a reasonable manner resulted in repeated schedule delays and increases in actual and projected costs,” they wrote. “It is unreasonable for ratepayers to have to bear increased costs as a result of the units not being constructed efficiently.”
Georgia Power spokesman Jacob Hawkins told E&E the electric utility is reviewing the testimony and will discuss any areas of disagreement during upcoming hearings.
The project’s total cost now stands at roughly $23 billion, up from $14 billion in 2008.
The PSC is weighing the project’s future. Regulators have scheduled a vote for mid-February.