Meanwhile, Georgia Power’s share of the project costs have continued to climb. Here’s what you need to know as the PSC’s five elected members begin to decide how much will end up in customers’ bills.
What are these hearings about?
The hearings scheduled for Monday, Tuesday and possibly Wednesday are to determine how much of Georgia Power’s spending on the Vogtle expansion has been reasonable and prudent, and can be passed on to ratepayers.
This week, commissioners will hear testimony from Georgia Power management and PSC staff who have monitored the project, plus expert witnesses called by environmental and consumer watchdog groups.
The company’s latest status report shows it expects to have spent more than $10 billion on capital and construction costs by the time the second reactor, Unit 4, goes online next year.
How much might the company collect?
While the PSC still has to vote on the costs and rate hikes, there’s not expected to be much drama in these proceedings.
That’s because Georgia Power, the PSC’s staff and several consumer advocacy groups reached a preliminary deal — known as a stipulation — back in the summer. If approved, the agreement would allow the company to pass $7.6 billion of the remaining Plant Vogtle expansion costs on to ratepayers. The rest would be absorbed by the company’s shareholders.
While that’s less than the roughly $10 billion the company expects to ultimately spend building the two new reactors, it is far more than the $4.4 billion in construction costs forecast when the project began more than a decade ago.
In their pre-filed testimony, Georgia Power executives said the stipulation “strikes an appropriate balance among complex, technical issues and provides for the recovery of reasonable and prudent costs for the project.”
While the PSC staff identified significant missteps by Georgia Power in managing the project and issues with poor construction quality, they too agreed that the $7.6 billion deal is a fair resolution.
Others strongly disagree. In her pre-filed testimony, Patty Durand, an energy consultant and Democratic candidate for the PSC’s District 2 seat currently held by Republican Vice-chairman Tim Echols, called the stipulation a “very bad deal for customers.”
How much could this increase bills?
If the PSC approves the stipulation, it will significantly raise customers’ bills.
Calculations by The Atlanta Journal-Constitution show that customers on Georgia Power’s standard residential rate using 1,000 kilowatt hours of electricity a month could see their monthly bill jump by roughly 5% to 6%, with exact amounts varying based on energy usage and the month of the year.
That’s on top of the rate hike that hit customers’ bills late this summer after Unit 3 went into operation. For the same customer, the Unit 3 increase already added $5.42 to their monthly bill.
Credit: Arvin Temkar/AJC
Credit: Arvin Temkar/AJC
These rate hikes would remain in place until at least 2025, when they could be adjusted by the PSC. But Georgia Power customers are likely to be paying at least some amount for Vogtle’s expansion in their monthly bills for the entire life of the reactors, which the company estimates will be 60 to 80 years.
Meanwhile, the average Georgia Power customer has already paid almost $1,000 to finance Vogtle in their monthly bills over the last decade-plus. That’s double what they would have paid if the reactors had been finished on time.
What happens next?
While the PSC commissioners could tweak the stipulation, major changes are unlikely. Historically, commissioners have largely approved these preliminary deals, though it is unusual for Georgia Power and the other interested parties to reach an agreement before hearings even begin.
After the hearings conclude this week, parties will be able to weigh in again during a public committee meeting set for Dec. 14. The commission will take a final vote on the on Dec. 19.
Any rate increase that is approved would likely take effect in April 2024.
A note of disclosure
This coverage is supported by a partnership with 1Earth Fund, the Kendeda Fund and Journalism Funding Partners. You can learn more and support our climate reporting by donating at ajc.com/donate/climate/