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Manufacturing

Dec. 12 – Plant Vogtle’s fate accelerated; May be determined at Dec. 21 Public Service Hearing

Category: Manufacturing

By Lou Phelps, Savannah Business Journal

December 12, 2017 – At the Georgia Public Service Commission’s meeting Dec. 21, a decision is expected on whether Georgia Power can continue to charge customers for the completion of the two-unit Vogtle nuclear plant expansion that has been mired by cost overruns, and a construction schedule that is years behind schedule.

The two nuclear reactor units were originally scheduled to be completed by 2017, at a cost not to exceed $14 billion.  The project is now at $20 billion and climbing, is not near completion, and there is no guaranteed that the reactors would ever be licensed, due to construction issues.

According to the Public Service Commission’s Chairman Stan Wise, in a statement issued Monday, this schedule represents an acceleration of the timetable for the decision, which had previously been planned for February.

“The change is being made because of tax code changes that could affect returns to the company,” according to the PSC filings by Wise and Georgia Power last week.  "It's important we move forward before the end of the year," Wise stated.

Adding to the confusion over which direction the PSC will go, is an independentconsultant’s report, that has stated that the project should be shelved due to an inability to determine final costs.   It set the cost to complete the plant – the first new nuclear reactors to be built in the U.S. since the Three Mile Island accident – at $20 billion, and climbing.  If the PSC decides that Georgia Power can no longer charge customers, it is anticipated that the company may end the project. 

“Georgia Power is seeking approval of costs spent earlier this year and assurances it will be eligible to collect almost all spending on the project,” explained Platts, an industry analyst publication, in an article published Monday.

The possible changes to the U.S. corporate tax rates, which are anticipated to lower corporate rates from 30% to as low as 20%, would affect how much Georgia Power can recover from its customers.  There is a charge on every customer’s electric bill, monthly.

Wise wrote, in a letter dated Dec. 6, that if the project is abandoned before Dec. 31, Georgia Power customers would save $150 million because the monthly charge to customers that the PSC had previously approved for 2017, was based on the current corporate tax rates.

Georgia Power owns 45.7% of the Vogtle plant expansion, along with three power company partners.

Former Sen. Sam Nunn issued a statement last week, urging the PSC to approve completion of the project, stating that it was a matter of national energy security. 

The plant could be finished by Georgia Power, but without ratepayers paying any more of the costs. 

“If Georgia Power does not accept that decision, the project should be canceled, said Steven Roetger, the lead analyst for the PSC staff,” according to a report this week by Platts.   “If a decision is made not to finish the partly built nuclear units, the PSC staff would recommend construction of an equivalent amount of capacity of natural gas-fired plants at alternate locations, Roetger said,” Platts reports. 

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