Uncertainty has loomed for years over whether Georgia Power customers will be stuck paying for big cost overruns on the the nuclear expansion under way at Plant Vogtle near Augusta.
The issue wasn’t expected to be settled until after the first of two new reactors is online, now slated to be in mid 2019.
But a move Friday by Georgia Power could push the state’s elected Public Service Commission to act now, rather than letting the matter lie until years in the future when the PSC might have a different makeup.
And by getting approval now for what is ultimately at least $1.4 billion in higher costs, the company might avoid having to halt its collection of the project’s financing costs for anything beyond the original cost estimate. Georgia Power customers already are paying Vogtle’s financing expenses in their monthly power bills.
PSC Commission Chairman Chuck Eaton said he’s trying to understand the ramifications of what the company is asking for in its Friday filing.
But he said he thinks the company’s moves “would be a step in the direction of gaining recovery for those extra costs sooner rather than later.”
Once the company completes construction of the first new unit, it would be allowed to collect costs that weren’t considered “imprudent.”
Buzz Miller, the company’s executive vice president for nuclear development, said state law requires the company to seek certification of the higher amount.
Asked what the company might do if the PSC opts not to take such a step now, Miller said, “We will have an educated discussion back and forth with the commission. We will determine a path forward that is productive for customers.”
There have long been expectations that consumers could end up with the bill for some of Vogtle’s ballooning costs.
But the PSC put off the decision for years, agreeing with the company to not certify additional expenses until after the first of two new units was completed.
PSC commissioner Tim Echols wrote Friday in an email to The Atlanta Journal-Constitution that he’s sure there are legitimate added costs for the project.
“Georgia law allows utilities to recover prudent costs regardless,” Echols wrote. “I think our previous decision to wait until Unit 3 is operational is still the best course of action until there is a basis to change it.”
Georgia Power’s Miller said the company remains committed to building a safe facility. He said the higher costs will have minimal impact on what are billions of dollars in benefits to customers over the decades-long life of the plant.
Even with the cost increases, Miller said, customer rates will go up only about 2.2 percent more than what they are now. (Already customers are paying roughly 4.6 percent more in their bills to cover Vogtle’s financing costs.)
Bobby Baker, an attorney who represents the Southern Alliance for Clean Energy, a critic of the Vogtle expansion, said in an email to the AJC that seeking a PSC cost review now rather than waiting several years “is the appropriate thing to do, but the company should not be allowed to increase its profits from the higher certified amount. The Commission should not provide a positive incentive to the Company for more cost overruns.”
Baker, a former PSC commissioner who cast the sole vote against Vogtle’s original approval, wrote in an email to the AJC Friday that a cost review by PSC regulators “who are most familiar with the facts is theoretically better than delaying a review until 2020 when memories will have faded and staff and commissioners will have retired and been replaced by individuals who aren’t as familiar with the facts.”
Vogtle’s price tag is on track to hit just over $7.5 billion, based on figures in the company’s filing with the PSC. That factors in higher costs as a result of an 18-month delay that the state’s largest utility disclosed late last month, as well as previous push backs. Combined, the expansion is now expected to be more than three years behind schedule.
Georgia Power estimated the project would cost $6.1 billion when it won the PSC’s approval for it in 2009. The PSC eventually must decide whether to pass along any of that increase to the monthly bills of Georgia Power customers.
Vogtle’s expansion represents the first major newly licensed U.S. nuclear power reactors in three decades.
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