Tuesday, March 21, 2023

Georgia nuclear plant cost now estimated at upwards of $30 billion

ATLANTA ( Associated Press) — A nuclear power plant being built in Georgia is now estimated to cost its owners more than $30 billion.

A financial report from one of the owners on Friday clearly put the cost of the plant near Augusta Vogel past that milestone, bringing its total cost to $30.34 billion.

This amount does not count the $3.68 billion that original contractor Westinghouse paid owners after bankruptcy, which would bring total expenses to more than $34 billion.

Vogtl is the only nuclear plant under construction in the United States, and its cost may preclude other utilities from building such plants.Even if they generate electricity without releasing climate-changing carbon emissions.

The latest budget increase by Georgia’s Municipal Electric Authority was not surprising after lead owner Georgia Power Company announced delays and a $920 million overrun on March 3. Georgia Power’s costs only cover 45.7% of the plant. It is proprietary, meaning that the cooperatives and municipal utilities that own the majority of the two-reactor project also update their financial projections later.

MEAG, which owns 22.7% of Vogtle and powers city-owned utilities, raised its total cost forecast, including capital expenditure and borrowing costs, to $7.8 billion from a previous level of $7.5 billion.

Oglethorpe Power Corp., which supplies electricity to 38 cooperatives in Georgia. has 30% stake in Vogtle. In March it increased its cost of projects from $250 million to $8.5 billion.

The City of Dalton, which owns 1.6%, estimated its cost in 2021 to be $240 million. It has not released any public updates.

The municipal utility in Jacksonville, Florida, as well as some other municipal utilities and cooperatives in Florida and Alabama, are obligated to purchase electricity from the plant.

When approved in 2012, the cost of the third and fourth reactors was estimated to be $14 billion, with the first electricity being generated in 2016. Now the third reactor is set to start operations in March 2023, and the fourth reactor is set to start operation in December. 2023.

Atlanta-based Southern Company, which owns Georgia Power, is charging its cost-running shares as shareholder losses, saying it is unlikely the Georgia Public Service Commission will pay bills for Georgia Power’s 2.6 million customers. Will approve adding amount. But Oglethorpe, MEAG, and Dalton are not shareholders, meaning customers are exposed to a complete overrun.

Georgia Power customers, as well as some Oglethorpe customers, are already paying the cost of Vogtl.

To protect themselves, other owners signed a deal with Georgia Power in 2018 specifying that if costs reach a certain point, other owners can choose to freeze their costs at that level. Huh. In exchange for paying the higher cost, Georgia Power would own a substantial portion of the reactors.

Oglethorpe wants to stabilize its costs at $8.1 billion, selling 2% of the reactors to Georgia Power in exchange for Georgia Power paying $400 million more in costs. MEAG also said on Friday it wanted to stabilize its costs, but did not say how much effort it made to move Georgia Power.

Southern has acknowledged that it will have to pay at least $440 million to cover the costs of the other owners, and has said another $460 million is in dispute.

Georgia Power is disputing the cost limit it should incur, saying it should not pay other owners’ share of additional costs stemming from COVID-19. The owners are negotiating with the aim of resolving their disagreement.

“Cost sharing is imminent, however, until the parties reach agreement, Oglethorpe will continue to pay its full share of construction costs billed by Georgia Power, but will do so under contractual opposition,” said Mike Smith, CEO of Oglethorpe. Said in March.

All owners voted to continue construction on 25 February. Also, the owners reported that in March the US Nuclear Regulatory Commission completed a follow-up inspection of wiring problems at the third reactor and signed off on identifying problems in November. Fixed, returning the reactor to its less intensive baseline monitoring regime.


Follow Jeff Amy on Twitter http://twitter.com/jeffamy,


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