What will it cost to build Southern Co.’s new nuclear reactors at Plant Vogtle?

Public witnesses voice concerns about Vogtle before the GA PSC

So, what is the current cost estimate for building two new Toshiba-Westinghouse AP1000 nuclear reactors at Southern Company’s Plant Vogtle near Waynesboro, Georgia along the Savannah River? It seems like it should be a simple question but it clearly is not. And the answer depends on when you ask, who you ask, what your question is exactly asking, how you ask the question and how much patience you have to wait for an actual answer. Those of us who attended the all-day public hearing in Atlanta before the Georgia Public Service Commission (PSC) in mid-December on the 13th semi-annual Vogtle Construction Monitoring (VCM) docket know what I’m talking about. For those of you who couldn’t, you can listen to it here (in 3 parts).

Here are the highlights (or “lowlights”) to save you time:

  • The project is at least 39-months delayed; though more than five years in, only 26 percent of construction is complete.
  • With more delays come more cost increases, in excess of $2 million per day for Georgia Power’s share of the project (they are 45.7 percent owners).
  • Georgia Power’s estimated cost is now over $9.5 billion, more than $3 billion above the certified cost of $6.113 billion.
  • All project benefits have been eliminated by the detriments (e.g. increased financing costs, replacement fuel costs, etc.).
  • Approximately $21 billion was mentioned as the current total cost estimate for the entire Vogtle project, a staggering increase since the $14.1 billion estimate in 2009 (this figure does not include costs associated with even further delays).

But as I said earlier, when it comes to the Vogtle monitoring docket, getting the “answer” depends on who you ask and when and how. For example, Southern’s 13th VCM report and their witnesses who testified in early November stated that the current estimated project cost was just over $7.4 billion. It wasn’t until expert witnesses on behalf of the PSC’s Public Interest Advocacy Staff filed testimony later that month that we learned the cost is $8.409 billion, a 38 percent increase since certification, which includes the lost fuel savings and the $350 million cost increase for Georgia Power’s share of the project given the settlement between the utility owners and lead contractor Westinghouse that was announced in late October and recently finalized.

Expert witness for Public Interest Advocacy Staff testifies

And then it took our attorney, former PSC Commissioner Robert “Bobby” Baker, to ask the important questions at the December hearing to tease out important details. Such as the fact that the 46 percent tax true up rate on the approximately $2.4 billion in financing costs associated with the 39-month delay should be included, bringing Georgia Power’s estimated cost to over $9.5 billion, more than $3 billion above the certified cost from 2009. And given Georgia Power is just one partner in the project, the total project cost estimate is now around $21 billion. You can watch the full cross examination here or a few short, but revealing excerpts here:

Conveniently for the Company and unfortunately for utility customers, no one gets to question Georgia Power’s experts again now that we have a better picture of what’s really going on. That’s because the Company once again did not submit rebuttal testimony — if it had, a hearing would have been held on January 19. The PSC is set to vote on approving the $148 million in expenditures on February 18, 2016.

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So, 5 years and 26% complete, then 10 years and 52% complete? Then 15 years and 78% complete, still not finished??? I lived in Ga. during the first vogtle work. Then we were told the utility could build 4 reactors for 660 million $. Two were finally finished costing 4.5 Billion dollars each. So the two now being worked on are really 5&6. My light bill went up 3 times it’s usual amount. I did nothing to cause such an increase in my electric usage. I am glad I no longer live in Ga.
With the work so over budget, this is more proof that atomic energy is truly not even affordable. Still no solution for the deadly wastes. Then there is all the irradiated metals that Must be kept out of the now unpolluted scrap metal stream. Good luck Ga.

Comment by Peter Sipp on January 11, 2016 10:39 am

Still a better choice for new energy needs, and I live in Georgia and have to deal with the minimal price increases on my utility bill. Plus the amount of people that have been able to work is phenemonal in the workplace and to the Vogtle community. Local businesses able to do some good in their own town. Once the project is complete and it’s clicking along, everyone should calm down about the costs and be proud of the new benefits.

Comment by Garrick Orvin on January 11, 2016 11:28 am

Thanks for these recents comments. Georgia Power customers should be aware that they are already paying more than 9.4 percent on their monthly bills in Nuclear Construction Cost Recovery (NCCR) costs due to anti-consumer state legislation passed in 2009 to incentivize building new reactors. You can see this on your itemized utility bill. Over $1.4 billion in pre-collected financing costs have been charged to ratepayers and the financing costs represent the largest share of the project’s cost overruns. This rate will increase to over 9.7 percent starting this month, in January 2016. Approximately $2.4 billion in ADDITIONAL financing costs are associated with the 39-month delay. But that did not include the 46 percent tax true up rate — once that is added it brings Georgia Power’s estimated cost to over $9.5 billion, more than $3 billion more than the certified cost. Further, PSC PIA staff witness testified that the project’s estimated benefits have been fully eliminated by the detriments.

Comment by Sara Barczak on January 11, 2016 11:44 am

Arjun Makhijani’s list of reasons not to invest in nuclear power tell the story. The list is available upon request to Sara Barczak of SACE.

Comment by Ross McCluney on January 11, 2016 12:21 pm

Hi Ross — can you please post the link here as a comment as then our audience will be able to easily access Dr. Makhijani’s list that you refer to? Thanks!

Comment by Sara Barczak on January 11, 2016 12:26 pm

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