Updated: 4:13 p.m. Wednesday, July 27, 2011 | Posted: 4:06 p.m. Wednesday, July 27, 2011
Southern Co.'s profits up on nuke finance fees
By Kristi E. Swartz
The Atlanta Journal-Constitution
A fee added to Georgia Power bills to help finance a planned nuclear plant expansion also helped parent Southern Co. post an 18 percent profit gain in the second quarter.
The $3.73 monthly fee offsets financing costs for two proposed nuclear reactors at Plant Vogtle.
Atlanta-based Southern cited it as one of the factors lifting net income to $603.3 million, or 71 cents a share, in the April-June quarter compared with $510.2 million, or 62 cents a share a year earlier. Profits were also helped by a hot early summer, the company said.
Revenue for the quarter rose 7.5 percent to $4.52 billion.
Georgia Power’s net income rose nearly 30 percent to $309 million, while revenue rose 13.3 percent to $2.27 billion.
Georgia Power is part of a group of utilities that want to build two additional reactors at Vogtle. The financing fee, approved by the state legislature and Public Service Commission, is intended to pay for about $1.6 billion in financing costs. Georgia Power said the ability to recover the costs upfront will save its customers $300 million once the reactors start producing electricity.
Federal regulators are expected to issue a revised licensing schedule for Vogtle in a few weeks, Southern CEO Tom Fanning told investors, warning them that a key license needed to start heavy construction may not be issued until early 2012, a few months later than expected. If that happens, the company will ask for a permit to continue with pre-construction work so the project can remain on schedule, he said.
“The whole issue is to preserve schedule and costs,” Fanning said.
In an interview with the Atlanta Journal-Constitution, Fanning also said the technology used in a new coal-fired power plant in Mississippi could some day make coal plants in Georgia roughly as clean as natural gas power stations. The plant will use technology that converts coal to gas, stripping about 65 percent of the carbon emissions from it. Fanning said the company wants to expand the technology so it can be used on older coal plants.