Construction at Georgia Power’s Plant Vogtle nuclear expansion project is moving more smoothly, with reactors likely to start producing electricity at the new target dates of 2017 and 2018, the project’s independent monitor said.
But further delays in building critical parts for the reactors could cause the schedule to slip again, according to the latest progress report to the Public Service Commission. Such delays could drive up the cost of the project, the report warned, and eventually wind up in customer bills.
“The cost of schedule delays continues to be potentially one of the largest cost drivers that could increase project costs,” according to a report from William Jacobs, Vogtle’s independent monitor, and Steven Roetger, an analyst for the Georgia Public Service Commission.
This would lead to increased construction costs and additional financing costs that could be “several hundred million dollars,” they wrote in the report.
Georgia Power and a group of municipal and cooperative utilities are building twin $14 billion reactors at the plant near Waynesboro. The utility said in February that the project will take 19 months longer than originally thought.
Georgia Power’s share of the project is 45.7 percent, or $6.11 billion, an amount boosted by $737 million because of the delays disclosed last winter. However, Georgia Power agreed last week to drop its request to raise the budget by that amount in a deal subject to approval by the PSC. Raising the official budget meant Georgia Power likely would have collected financing costs from consumers for at least one year longer than originally projected.
Initial delays were tied to key regulatory approvals to start major construction. The Plant Vogtle reactors are the first in the nation to be built from scratch in nearly a decade and face increased scrutiny.
Other delays stemmed from Vogtle’s main vendors not meeting stringent documentation rules and other quality assurance requirements. The utilities have contracted with Westinghouse and the Shaw Group, which is using its Louisiana-based subsidiary to make critical components for Vogtle reactors. The components are built elsewhere and assembled at Vogtle’s construction site.
Chicago Bridge & Iron bought the Shaw Group last year, a deal that has improved work schedules and quality for the components, Georgia Power said.
Workers poured concrete for the first of two reactors earlier this year. They’ve also made progress on building the reactors’ cooling towers and surrounding buildings.
Regulators grilled Georgia Power executives about the rising costs and scheduling delays at a recent PSC hearing. Georgia Power executives said cost jumps have been due to preparation work that’s now finished, and they expect no more delays.
“ … the schedule situation has greatly improved,” said the report, made available Friday morning.
The report covers the last six months of 2012 and will be discussed at a PSC hearing next Tuesday.
“A project of this scale and the money that’s involved and the fact that the company is involved in litigation with some of its subcontractors is always going to keep me concerned moving forward,”said PSC Chairman Chuck Eaton. “I am optimistic because we’re getting to where we’re substantially completing very large portions of the project.”
