Tag Archives: cost overruns

Opinion: An answer for Ga. Power

vogtle_ajcby Jay Bookman
11/13/17 ATLANTA: More than a decade ago, our good friends at Georgia Power conceived the idea of building two new nuclear reactors — the first to be built on U.S. soil in a generation — at its Vogtle site outside Augusta.

Georgia Power recruited the partners it needed from electric co-ops and city utilities around the state. It convinced its obedient servants at the state Public Service Commission to rubber-stamp the project, which they did by a 4-1 vote. (All four “yes” men are still on the PSC  today, still collecting their six-figure salaries, their durability testament to the wisdom of not crossing Georgia Power.)

The company hired the most powerful lobbyists in the state to supplement its own standing army of lobbyists, then strong-armed a law through a compliant state Legislature that forced consumers to start paying for the nuke projects immediately, long before they produced any power. Getting the signature of then-Gov. Sonny Perdue on that bill also proved to be no problem, since the man whom Perdue had hired as his chief of staff happened to have been Georgia Power’s top lobbyist for decades.

Georgia Power chose the design. Georgia Power hired the contractors. Georgia Power assured everyone who would listen that the problems that had long dogged nuclear power — the safety concerns, the massive cost-overruns and construction delays — had been resolved, and that the units would be up and producing power by 2017 just as scheduled. Critics who noted the difficulty and risk of trying to restart a complicated, zero-defect industry from scratch were steamrollered.

The message from the company was steadfast: “Don’t worry, we got this.”

Well no, they didn’t. They were wrong, spectacularly wrong, and their critics have been proved right. Under the original schedule, both new nuclear units should have been producing power by now. Instead, they are less than half built. The cost overruns have been enormous, basically doubling in cost even if nothing further goes wrong. And what is the price to be paid for such failure?

For Georgia Power, the price is none. No price, and to hear Georgia Power tell it, no failure. In a meeting last week with reporters from the Atlanta Journal Constitution, Georgia Power CEO Paul Bowers was asked whether the company deserved any blame or responsibility for imposing this financial catastrophe on the people of Georgia.

“The answer to that question is no,” Bowers said.

No? The answer to that question is no?

Read the whole article: Atlanta Journal-Constitution

Share Button

CEO of Georgia powerhouse skips the whole apology thing

bowersby Matt Kempner
11/8/17 ATLANTA: If you made a giant mess that your neighbors were going to end up paying for, would you take a moment to apologize to them? Perhaps at least mumble something about “regret”?

Georgia Power’s CEO did not utter such words the other day. Not even close.

CEO Paul Bowers made a rare personal appearance at a hearing before the Georgia Public Service Commission this week. He was there to explain why state regulators should continue the Plant Vogtle nuclear expansion project and force the company’s customers — his neighbors — to take on way more risk and billions in additional costs because the project has careened off the rails.

“We understand that this is a complex and difficult decision,” Bowers told the elected body.
The project was supposed to be producing electricity before now. Instead, after years of busted assurances and forecasts, Georgia Power’s latest estimate is for completion in another five years.

Maybe. Because now it’s also warning that there’s a whole lot that still could go wrong to screw up its latest projection. So, don’t hold Georgia Power accountable to that timetable.

Bowers didn’t hint at any remorse during what apparently was his only appearance in a Georgia PSC hearing since getting Georgia Power’s top job almost seven years ago. As Sir Elton sang: “Sorry seems to be the hardest word.”

Read the whole article: Atlanta Journal-Constitution

Share Button

Time to decide if you pay more for Georgia’s nuclear debacle

by Matt KempnerVogtle_ajc_8-3-17
11/3/17 ATLANTA: Don’t read beyond this sentence if you don’t pay a power bill in Georgia and never will.

Otherwise, get your wallet out.

There’s a bit of show biz about to start Monday in hearings with elected state regulators. When it’s over, it’s likely to end up costing you and your Georgia descendents for decades to come.

That’s because the only giant, deeply delayed, steeply over-budget nuclear power construction project still underway in the U.S. may well get another wink and pat on the back from Georgia regulators.

So far, Georgia politicians have failed to enact significant consumer protections that would limit a government-enforced monopoly (Georgia Power) from sidestepping the vast majority of risk while raking in extra (extra!) profits on the overruns for the company’s Plant Vogtle expansion.

Elected members of the Georgia Public Service Commission start the first of four days of hearings Monday. It’s Round One in what on paper could be a momentous decision after years of complex construction plagued by unfinished designs, incomplete scheduling, flawed parts and workmanship, insufficient oversight early on and too much worker downtime.

The PSC accepted the setbacks, missteps and busted budget in the past. But now PSC members are faced with their first go/no-go vote since originally approving the project in 2009. That’s because the bankruptcy of Westinghouse, the project’s main contractor, throws significantly more risk and cost into the mix.

Read the whole article: Atlanta Journal-Constitution

Share Button

Georgia Power vs. the law of holes

Plant-Vogtle-construction-2014by Lyle Harris
10/16/17 ATLANTA Georgia Power is likely to get another shot-in-the-arm after announcing plans to complete construction on those ill-fated nuclear reactors at Plant Vogtle near Waynesboro.

A more appropriate response to this epic boondoggle, of course, would be a swift kick in the pants. But don’t count on it.

The Georgia Public Service Commission (PSC) has scheduled hearings on November 6 to discuss the troubled project, Along with the Southern Company (Georgia Power’s corporate parent) and the smaller utilities that are partners on the Plant Vogtle expansion, there’s little reason to worry about some silly old hearings. While the PSC is ostensibly charged with balancing the interests of the utility with those of its customers, the scales are reliably tipped in Georgia Power’s favor.

The planned reactors at Plant Vogtle were supposed to be up and running by now but they’re only about one-third complete. A series of major snafus and setbacks (including the bankruptcy of Westinghouse Electric which designed and was building the reactors) has increased chances that Georgia households will be picking up more of the tab.

Read the whole article: Saporta Report

Share Button

Georgia Power has nuked their credibility

by Jay Bookman
8/8/17 ATLANTA: It really is hard to believe.

Eight years after Georgia Power officials confidently assured us that they had this nuclear thing figured out, that two new units at Plant Vogtle could be brought in on budget and on time, leading a supposed renaissance in the U.S. nuclear industry, it’s all in danger of collapsing.

The projected cost of those units has almost doubled, to $25 billion and counting. Completion is still years away, and the prime contractor has gone bankrupt. Last month, construction of two similar units in South Carolina, facing similar cost overruns and delays, was abandoned after it became clear that the additional investment needed to complete the units could not be justified.

Now it’s Georgia’s turn.

Read the whole article: Atlanta Journal-Constitution

Share Button

‘Idle’ workers cited at delayed Vogtle nuclear power project

Unknownby Matt Kempner
6/16/17: Add “idle” workers to the list of troubles at Georgia Power’s struggling nuclear expansion at Plant Vogtle.

Construction workers are supposed to be toiling away on the project that’s already three years behind schedule and falling farther behind.

But a state monitor recently testified that “idle time, early quits and late starts remained high” among construction workers on the first new-from-scratch U.S. nuclear energy project in 30 years.

“Low productivity has been a continuing issue,” according to written testimony by the construction monitor, William Jacobs, and Steven Roetger, a Georgia Public Service Commission staffer assigned to oversight of the project. They cited reviews by a consultant for the project’s contractor.

Attempts to improve the pace of work had little effect on productivity in the last year, they added. In fact, crucial parts of the construction have faced growing delays.

Read the whole article: Atlanta Journal-Constitution

Share Button

Vogtle completion ‘uneconomic,’ Ga. PSC consultants say

moneyreactors-300x300by  Colby Bermel
6/13/17: Consultants to the Georgia Public Service Commission said June 8 that Westinghouse Electric Co. LLC’s bankruptcy has “invalidated” Georgia Power Co.’s cost calculations at its Alvin W. Vogtle Nuclear Plant and it would be “uneconomic” to complete the plant’s expansion.

The consultants also said that if Georgia Power were to continue construction, the Southern Co. subsidiary will spend $3 billion more on Vogtle than what it predicted in a recent report and the plant’s new units will go online three years later than the company anticipates.

Philip Hayet and Lane Kollen, both vice presidents and principals at J. Kennedy and Associates in Roswell, Ga., submitted written testimony to the commission on behalf of its Public Interest Advocacy Staff. The state agency is conducting a review of Georgia Power’s $222 million in Vogtle construction costs during the second half of 2016 for the Vogtle Construction Monitoring Report, or VCM.

Read the whole article: S&P Global Market Intelligence

Share Button

Millions collected from schools, taxpayers for Vogtle construction

2812409_web1_Plant-Vogtleby Thomas Gardiner

6/11/17: Since 2009, Georgia Power customers have been paying up front for construction costs at the Plant Vogtle nuclear expansion.

Some public entities will have paid more than $1 million for construction before a single kilowatt hour of energy is generated by the expansion.

Georgia Power extended its interim agreement with Westinghouse by 24 hours recently to give the two companies time to finalize a transition agreement as the utility company takes over in the wake of the Westinghouse bankruptcy. That bankruptcy was fueled by cost overruns at the Plant Vogtle and VC Summer nuclear expansion projects.

According to legislation passed in 2009, Georgia Power shall collect costs related to nuclear construction financing and interest to support the plant’s construction, even though the project failed to meet its operational deadline in 2016.

Read the whole article: Savannah Morning News

Share Button

PSC Commissioner Moves for Georgia Power to Stop Collecting Nuclear Tax

bubba-2by Gloria Tatum
6/11/17 (APN) ATLANTA — Georgia Public Service Commissioner Lauren “Bubba” McDonald (District 4) filed a motion to give Georgia Power ratepayers a break by asking the company to suspend collecting the nuclear construction tax, or CWIP.

But it had as much chance as a snowball in hell of being honored by the PSC or Georgia Power.  The Commission voted to hold the motion and refer it to the Georgia Attorney General for an opinion, in a four to one vote on June 06, 2017.

“I move that the Commission request that the Company voluntarily agree that as of July 1, 2017, it will stop collecting any financing charges under the Nuclear Construction Cost Recovery (NCCR) tariff,” McDonald’s motion read.

“Effective July 1, 2017, the Company will utilize Allowance for Funds Used During Construction (AFUDC) accounting treatment on the Construction Work in Progress (CWIP) balance of all Unit 3 and 4 capital costs,” the motion stated.

Read the whole article: Atlanta Progressive News

Share Button

Southern’s path to ‘first’ new reactor filled with pitfalls

image_asset_18775by Kristi Swartz
6/8/17: Southern Co.’s nuclear expansion project in Georgia was behind schedule even before it got started.

Contractor Westinghouse Electric Co. LLC and the Nuclear Regulatory Commission grappled with design changes for the new AP1000 technology, delaying the agency’s issuance of the major construction license by four months in 2012.

They’ve never been able to catch up.

The delay was small at the time because Southern’s Georgia Power unit and the contractors said they could make up the time in some way. What’s more, the schedule slip meant little compared with the broader story: Georgia Power was restarting the nuclear industry after 30 years with Plant Vogtle.

The twin reactors would start producing electricity in 2016 and 2017.

Read the whole article: E&E News

Share Button