A consumer watchdog group on Thursday continued to press for an agreement that would make Georgia Power — and not consumers — pay for any major cost overruns at its Plant Vogtle nuclear expansion project, but Georgia utility regulators remained resistant.
At an energy committee meeting in their downtown Atlanta chambers, Public Service Commission members said they would support only a July 18 deal reached between Georgia Power and the PSC’s advocacy staff, one that removed a recommendation calling for Georgia Power’s profits to be reduced should the costs to build two nuclear reactors at Plant Vogtle exceed budget by $300 million. Additional costs, with PSC approval, would show up in customers’ monthly utility bills.
Georgia Power executives have argued that a cost-containment plan, originally considered and rejected by the PSC but still pursued by Georgia Watch, could drive up the project’s financing costs, potentially damaging the ability to raise capital. That, in turn, could increase customer bills.
Commissioner Tim Echols was more pointed, saying approval for such a plan would “chill the construction of nuclear plants in the United States.”
Attorney Clare McGuire for Georgia Watch argued that consumers would be left with no protection against bill increases should the project go beyond its budget.
“Georgia Power doesn’t want to be held to costs beyond its control,” McGuire said. “The ratepayers have no choice.”
However, PSC has a Georgia Power concession in its July 18 agreement that allows regulators to re-examine previously approved parts of the project should a mishap lead to a budget increase. If regulators determined that Georgia Power made a mistake, consumers would not have to pay the additional costs.
As part of the concession, the person or agency questioning those expenses must be armed with sufficient proof, however.
“I’m surprised we actually got this concession from the company because this has been an issue that has been debated since Day 1,” Commissioner Chuck Eaton said.
Georgia Power is responsible for $6.1 billion of the estimated $14 billion Plant Vogtle project. The utility has clashed with the PSC’s advocacy staff for months over who would pay for potential cost overruns at Vogtle. The advocacy staff dropped pursuit of the profit-cutting plan that Georgia Watch continues to seek.
The PSC is scheduled to vote on the stipulation on Aug. 2
“I think basically we send a message to the company and their stockholders that nuclear power is too risky for Georgia,” Echols said, referring to Georgia Watch’s demand. “That is frankly not a message that I want to send.”
Eaton said any plan that divides up cost overruns between Georgia Power’s shareholders and its customers could lead to unintended consequences.
“If the company does not manage the project prudently, their shareholders eat every dime,” Eaton said. “It’s almost like now some folks are saying, ‘Let’s share in that,’ and I don’t think we ought to share. I think they ought to have all of it, eat all of it.”
The PSC reviews and approves costs for Vogtle twice a year. Their information is based on reports from an independent construction monitor, hired to continually monitor the process at Vogtle and warn if the project goes off schedule or costs exceed projections.
PSC’s advocacy efforts are meant to prevent what happened when Vogtle’s first two reactors were built in the 1980s. The project exceeded its seven-year deadline by nine years and its $660 million budget by more than $8 billion.
The PSC told Georgia Power that $1 billion had to come out of the company’s profits; customers paid for the remaining $7 billion through a 12-percent increase in their monthly power bills.
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