Construction costs for Georgia Power’s planned expansion project at Plant Vogtle are $42 million over budget, and delays in getting federal approval to build the two reactors may push back the construction schedule roughly five months, company executives said Monday.
The rise in construction costs are related to, among other things, a change in what labor may cost over the long term for the project, said Pete Ivey, vice president of nuclear development support for Georgia Power’s sister company, Southern Nuclear.
The increased costs do not impact the total cost of the project and will not appear on customer bills, Georgia Power said.
The estimated cost of the project is $14 billion. Georgia Power is responsible for roughly $6.1 billion, 75 percent of which is construction costs and the balance is financing costs. While construction costs are exceeding the current budget by $42 million, the financing costs currently are $60 million under budget, the company said.
Georgia Power is part of a group of utilities building two reactors at Vogtle, which is near Waynesboro in eastern Georgia near the South Carolina border. They cannot begin heavy construction until federal regulators sign off on the reactor’s design and then issue a key construction license. Officials said Monday they expected to receive that license by the end of the year. The first reactor is scheduled to start producing power in April 2016, and the second one a year later.
Ivey warned, based upon information the company received last week, that the first reactor may not start producing electricity until September 2016. That document, the monthly construction monitoring report,is trade secret and not available to the public.
Executives are reviewing ways to make up that delay with what they call a compressed schedule. Making up time could mean additional workers, shifts and other pressures, Ivey said. On the other hand, a delay could mean overhead costs and the carrying costs associated with financing charges could increase, he said.
Georgia Power faces additional obstacles related to the project, Ivey said. The company has added workers for oversight to meet stricter company and federal regulatory standards. Though it is not clear when, Ivey said the company would ask to recover the cost of having those workers, something that riled Georgia Public Service Commissioner Tim Echols.
“Our ratepayers should not have to be responsible for your having to babysit these contractors,” said Echols.
At the end of the meeting, Echols asked the company to provide an updated, itemized list of additional costs incurred during the first six months of the year and the last six months of 2010.
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