Tag Archives: taxpayer loans

Vogtle’s fate no clearer after tense negotiations

Unknownby Kristi Swartz
9/26/18 The future of the nation’s lone nuclear construction project remained unclear last night as its utility partners continued to negotiate over how to handle its rising costs.

Expenses at Southern Co.’s Plant Vogtle expansion project have jumped $2.3 billion in just one year. Vogtle’s budget is roughly double what it was a decade ago, but the reactors were at a crossroads Monday when one of the business partners said it would walk away unless the construction costs were capped.

That talks among the developers — Southern’s Georgia Power Co., Oglethorpe Power Corp., the Municipal Electric Authority of Georgia (MEAG) and Dalton Utilities Inc. — have been extended until 5 p.m. today is a sign that they are trying to keep the reactors going. That is a far cry from yesterday, when Oglethorpe and its utility partners aired their disagreements — and anger — in lengthy public statements.

Read the whole article: E&E News

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A Crack in Co-owner Support for Vogtle, as Costs Skyrocket

vogtle-1-2-3-4by Gloria Tatum
9/8/18 (APN) ATLANTA — As the cost projections for the nuclear reactors 3 and 4 at Plant Vogtle continue to skyrocket, co-owner support for Plant Vogtle is on increasingly shaky ground, especially as credit rating agencies are talking downgrades based upon the instability of cost projections around finishing the reactors.

Georgia Power’s announcement last month of an unexpected increase of 2.3 billion dollars more to complete Vogtle 3 and 4 has triggered confusion and the requirement for a vote by each of the co-owners on whether to continue participating in the project by late September 2018.

Georgia Power cannot assure that the price will not continue to go up or that the service date will not continue to be kicked down the road by ongoing delays.

This has spooked both Wall Street and some minority co-owners of Vogtle 3 and 4.

Moody’s Investors Services has already issued a downgrade to Georgia Power’s rating, saying the 2.3 billion dollar increase comes just eight months after the Georgia Public Service Commission signed off on the previous round of increased cost estimates.

Co-owners’ exposure to cost increases has no actual end in sight, and this has consequences for investors.  Additional downgrades for co-owners are expected.

Now, Jacksonville Electric Authority (JEA) wants out of its agreement with Municipal Electric Authority of Georgia (MEAG) to buy power from Plant Vogtle 3 & 4 for the next twenty years and to share in the construction cost.  MEAG is one of the co-owners of Vogtle 3 and 4, owning 22.7 percent of the project.

In addition, Oglethorpe Power–a thirty percent co-owner–will have to nearly exhaust its 490 million dollar contingency fund, according to a company press release.

Read the whole article: Atlanta Progressive News

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Southern Co.’s Vogtle in Doldrums, Decision Due on Sep 30

2c0f2f2a9e6fdc3b971b95b11db0fbed8/24/18 ZACK’S — The dark cloud of uncertainty hovering over The Southern Company’s SO Vogtle project does not seem to dissolve. Even after the approval of the project by Georgia Public Service Commission (PSC) in December 2017, the power plant has again been hit by a fresh controversy, which can even result in the scrapping of the project. Presently, the fate of the Vogtle Projects rests on the minority holders. That is to say, if they are willing to absorb the ballooning costs of the project, only then the project will likely survive.

If the project gets scrapped, it will be a huge blow to the nuclear industry of America. Last year, South Carolina Electric & Gas — subsidiary of SCANA Corporation SCG — terminated the construction of the $18-billion VC Summer nuclear project in South Carolina. Duke Energy Corporation DUK also announced the abandonment of Lee III Nuclear Generating Station in South Carolina.

The Controversial Vogtle Project

Georgia Power, subsidiary of Southern Company, is the chief owner of the Vogtle project with 46% interest. The other co-owners include Oglethorpe Power, MEAG Power and Dalton Utilities, collectively accounting for 54% stake.

The Vogtle nuclear reactors have been grappling with cost overruns and scheduling delays since the commencement of the construction. Moreover, bankruptcy filing by Westinghouse — the major construction contractor of the two nuclear reactors of the plant — aggravated the costs further and led to more delays. Since then, the future of Vogtle project has been stuck in doldrums. The project is already running four years behind schedule, with a price tag of around $25 billion, almost double of what had been originally estimated.

Recent Roadblock

Earlier this month, Georgia Power revised the construction cost of the project, raising the price of the nuclear reactors by $2.3 billion from the prior expected level. With the revision, the total cost of the project now stands at $27 billion. Also, the investors in the project are required to re-evaluate their decision to proceed with the project by the end of September. In this regard, while Southern Company has already announced its intent to absorb the project’s $1.1 billion share of cost increase, the other three minority owners are yet to declare their decision.

Read the whole article: Zack’s Equity Research

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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

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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

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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

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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

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GEORGIA: Sinking into the Vogtle Vortex

The expansion of a Georgia nuclear power plant that fired up dreams for a carbon-free nuclear renaissance in the U.S. has turned into a quagmire of setbacks, financial woes, uncertainty and frustration.
Protest_smby Pam Wright
5/23/17: Cornelia Stumpf has had enough.

The Savannah resident joins more than 2 million other Georgia Power customers who collectively pay a reported $23 million a month for the construction of two new and highly controversial nuclear reactors that may never produce a single kilowatt of energy.

The new reactors at the Alvin W. Vogtle Electric Generating Plant, 30 minutes south of Augusta, were the first approved in the U.S. in 30 years, and they were expected to revive the nation’s nuclear power industry, ushering in an era of carbon-free energy to help control climate change. But the expansion at Plant Vogtle has become an expensive boondoggle for the company and its customers.

“What is upsetting to me is, in the end, I’m just one person and it’s added up to $700 in the six years since they began charging it,” says Stumpf, a conscientious consumer of energy who is speaking from her office on a 90-degree afternoon in May with the air conditioner off.

Georgia Power, a subsidiary of the Southern Company, implemented the 7 percent surcharge in 2011 after lawmakers gave the utility permission to charge customers for the construction of the project. The charge appears on consumer’s bill as “Nuclear Construction Cost Recovery.” So far Georgia Power has reportedly collected nearly $2 billion from the surcharge.

Read the whole article: The Weather Channel

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Cost of Westinghouse collapse turns up heat on Scana, Southern

summer

by Kristi Swartz
4/14/17: Scana Corp. executives might extend a contract with Westinghouse Electric Co. LLC as the utility decides whether to complete its multibillion-dollar nuclear power expansion in South Carolina.

Meanwhile, Southern Co.’s Georgia Power unit has yet to decide whether it needs more time to figure out how to proceed with its twin reactors under construction in Georgia.

Read the whole story: E&E News

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The High Cost of Ignoring Risk

www.usnews.comby Ryan Alexander
4/6/2017: Last week, Westinghouse Electric Co. announced that it will be filing for bankruptcy. Westinghouse, a subdivision of Toshiba Corporation, is in the process of building two AP1000 nuclear reactors for a power plant known as Plant Vogtle in Georgia. In fact, Westinghouse is bankrupt largely because of Vogtle. The project is a mess, and thanks to the $8.3 billion worth of loan-guarantees federal taxpayers have put into the project, courtesy of the Department of Energy, we are the ones who are going to take the hit if the whole things goes belly up.

In 2008, when the project originally applied for a federally backed loan guarantee, it was estimated that the two reactors under construction would begin commercial operation in April 2016 and 2017, respectively, and cost $14.3 billion. Instead of being completed this month, the project is less than halfway done, more than 39 months behind schedule, and at least $3.3 billion over budget. Now this.

Read the whole story: U.S. News

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