Georgia nuclear rebirth arrives 7 years late, $17B over cost

May 24, 2023, 9:10 PM

FILE - Reactors for Unit 3 and 4 sit at Georgia Power's Plant Vogtle nuclear power plant on Jan. 20...

FILE - Reactors for Unit 3 and 4 sit at Georgia Power's Plant Vogtle nuclear power plant on Jan. 20, 2023, in Waynesboro, Ga., with the cooling towers of older Units 1 and 2 billowing steam in the background. Company officials announced Wednesday, May 24, 2023, that Unit 3 would reach full power in coming days, after years of delays and billions in cost overruns. (AP Photo/John Bazemore)
Credit: ASSOCIATED PRESS

(AP Photo/John Bazemore)

WAYNESBORO, Ga. (AP) — Two nuclear reactors in Georgia were supposed to herald a nuclear power revival in the United States. But the project is seven years late and $17 billion over budget as Georgia Power Co. announced the first new reactor at its Plant Vogtle could reach full electrical output by Saturday.

They’re the first U.S. reactors built from scratch in decades — and maybe the most expensive power plant ever. Georgia electric customers have already paid billions, and state regulators will ultimately decide if they’re on the hook for billions more.

Some of the key promises of Vogtle — into bankruptcy when the company couldn’t absorb overruns.

And the lessons could be important because government officials and some utilities are again looking to nuclear power to alleviate climate change by generating electricity without burning natural gas, coal and oil.

Vogtle’s new Unit 3 began generating power in March and is scheduled to reach commercial operation by June. Unit 4 is next door on the same rural Burke County site 25 miles (40 kilometers) southeast of Augusta, along with two older reactors. It’s supposed to be finished by early 2024.

Georgia Power and its parent, Atlanta-based Southern Co., say the reactors are a triumph. Chris Womack, before he ascended from Georgia Power to become Southern Co. CEO, told The Associated Press that Vogtle is “absolutely” a success, arguing reliable power and cheap fuel costs will benefit the utility’s 2.7 million customers for decades.

“We recognize the upfront cost and some of the challenges that we faced,” Womack said in January at Vogtle. “But yeah, this is value. This is value contribution to customers, to the state, to the energy grid, to bringing back the nuclear industry and showing that we can do hard things.”

As with Vogtle, supporters of future nuclear plants promise new-and-improved designs can be mass-produced at reliable prices. But Vogtle opponents scorn renewed nuclear ambitions.

“I don’t see how anybody in their right mind cannot avoid saying ‘Well, what evidence do you have?’” said David Schlissel, a utility analyst who testified against Units 3 and 4 after fighting the first two Vogtle reactors in the 1970s. They also finished fabulously late and over budget.

In Georgia, almost every electric customer will pay for Vogtle. Georgia Power currently owns 45.7% of the reactors. Smaller shares are owned by Florida and Alabama utilities have also contracted to buy Vogtle’s power.

Currently, the owners are projected to pay $31 billion in capital and financing costs, Associated Press calculations show.

Japan’s Toshiba Corp., which then owned Westinghouse, paid $3.7 billion to the Vogtle owners to walk away from a guarantee to build the reactors at a fixed price after overruns forced electric industry pioneer Westinghouse into bankruptcy in 2017. Add that to Vogtle’s price and the total nears $35 billion.

defective work often had to be redone. Workers quit for other jobs and the COVID-19 pandemic led to high absenteeism.

Calculations show Vogtle’s electricity will never be cheaper than other sources Georgia Power could have chosen, even after the federal government reduced borrowing costs by guaranteeing repayment of $12 billion in loans.

Yet regulators say Vogtle was the right choice.

“Vogtle 3 and 4 will be a success not only for Georgia but for our country the moment that they go into service,” said Tricia Pridemore, who chairs the elected Public Service Commission of five Republicans. She argues nuclear power provides clean energy with prices immune from international market swings, and that building Vogtle increased U.S. nuclear engineering know-how.

Customers are already paying. Regulators estimate Georgia Power will collect $4.1 billion in advance charges, or $913 for every ratepayer. Some cooperative customers are also paying — nearly $500 million through March.

Georgia Power’s residential customers will begin paying an additional $3.78 per month as soon as Unit 3 achieves commercial operation. But the final bill won’t come until Unit 4 is complete. Commissioners must then decide how much of Georgia Power’s spending was prudent while disallowing wasted amounts. Commissioners earlier approved $5.7 billion as prudent, but Bryan Jacob of the Southern Alliance for Clean Energy said “management failures” should be scrutinized.

“Ratepayers shouldn’t foot the bill for things that management could have done right in the first place,” Jacob said.

Critics fear Georgia Power will profit from mistakes. Staff estimates show Georgia Power could earn an extra $9.4 billion in profit over 60 years if allowed to charge for all spending. Customers could pay $35.7 billion overall, $20.5 billion more than originally projected.

“If they can get away with it, they benefit from screwing up,” said Schlissel, the utility analyst.

Pridemore said it may be unfair to penalize Georgia Power for overruns beyond its control, but dismissed complaints about undue profits. “I’m very familiar with the mistakes,” Pridemore said, referring to commission monitoring of Vogtle construction.

Womack said Georgia Power won’t try to collect for all overruns, promising a “balanced” outcome. Southern Co. has written off $3.26 billion in Vogtle losses since 2018, suggesting it won’t recoup those costs.

“We’ll look at the best interests of our customers, but also look at the investments that we’ve made here and what’s good for the company,” Womack said.

American utilities have heeded Vogtle’s missteps, shelving plans for 24 other reactors proposed between 2007 and 2009. Two half-built reactors in South Carolina were abandoned.

But even opponents of Vogtle say the United States can’t achieve carbon-free electricity without nuclear power. Jacob’s group modeled how Southern Co. could achieve zero-carbon generation by 2035.

“It was very difficult for us to make the math work without nuclear,” Jacob said.

Reactors can run almost constantly, unlike wind and solar generation, and uranium fuel adds little cost.

“It’s one of the first units that come online, because from an operational expense, it’s the lowest cost energy that’s available,” Womack said.

So nuclear proponents are trying again. A multinational partnership including the Tennessee Valley Authority seeks to build scaled-down reactors designed by General Electric and Hitachi. The first small modular reactor, under construction east of Toronto, could be complete by 2028. TVA may build one near Oak Ridge, Tennessee.

“Worldwide we need to double the amount of nuclear capacity, possibly even triple it by 2050 in order to meet our net-zero carbon goals,” U.S. Assistant Secretary of Energy Kathryn Huff said in Washington in March, celebrating the partnership.

Some ideas are similar to Vogtle, including standardized designs and parts. Costs are rising for other designs planned for Wyoming. Still, supporters believe building smaller reactors will be less daunting.

Jay Wileman, CEO of GE Hitachi Nuclear Energy, acknowledges any nuclear revival must overcome past problems.

“Nuclear has to have a seat at the table, but we’ve got to earn our seat at the table,” Wileman said in March. “And to do that, we’ve got to be on schedule, on budget, and it’s got to be a competitive cost.”

But Vogtle observers view those pledges dimly.

“The industry has no track record of being right,” Schlissel said.

United States News

FILE - This booking photo provided by the Clay County, Mo., Sheriff's Office shows Andrew Lester. L...

Associated Press

Judge agrees to seal court documents in Ralph Yarl shooting; suspect to be in court

LIBERTY, Mo. (AP) — A Kansas City man accused of shooting a Black teenager who mistakenly came to his door last month is scheduled to be back in court Thursday, days after a judge ruled that court documents in the case will be sealed and kept from the public. The hearing for 84-year-old Andrew Lester […]

22 hours ago

FILE - Susana Lujano, left, a dreamer from Mexico who lives in Houston, joins other activists to ra...

Associated Press

Revised DACA program to be debated before Texas judge who previously ruled against it

HOUSTON (AP) — A revised version of a federal policy that prevents the deportation of hundreds of thousands of immigrants brought to the U.S. as children is set to be debated Thursday before a federal judge who previously ruled the program illegal. Attorneys representing the nine states that have sued to end the Deferred Action […]

22 hours ago

FILE - Jim Obergefell, the named plaintiff in the Obergefell v. Hodges Supreme Court case that lega...

Associated Press

LGBTQ+ Pride month kicks off with protests, parades, parties

NEW YORK (AP) — The start of June marks the beginning of Pride month around the U.S. and some parts of the world, a season to celebrate the lives and experiences of LGBTQ+ communities and to protest against recent attacks on hard-won civil rights gains. This year’s Pride takes place in a contentious political climate […]

22 hours ago

Associated Press

After sailing though House on bipartisan vote, Biden-McCarthy debt ceiling deal now goes to Senate

WASHINGTON (AP) — Veering away from a default crisis, the House overwhelmingly approved a debt ceiling and budget cuts package, sending the deal that President Joe Biden and Speaker Kevin McCarthy negotiated to the Senate for swift passage in a matter of days, before a fast-approaching deadline. The hard-fought compromise pleased few, but lawmakers assessed […]

22 hours ago

FILE - A statue of Walt Disney and Micky Mouse stands in front of the Cinderella Castle at the Magi...

Associated Press

LGBTQ+ people flock to Florida for Gay Days festival

ORLANDO, Fla. (AP) — Tens of thousands of LGBTQ+ people are flocking to central Florida this weekend to go on theme park rides, mingle with costumed performers, dance at all-night parties and lounge poolside at hotels during Gay Days, a decades-long tradition. Even though Gov. Ron DeSantis and Florida lawmakers have championed a slew of […]

22 hours ago

FILE - Sections of pipe are lined off of Cove Hollow Road in Elliston, in Montgomery County, Va., o...

Associated Press

Debt ceiling deal advances pipeline and tweaks environmental rules. But more work remains.

WASHINGTON (AP) — Despite weeks of negotiations, the White House and House Republicans were unable to reach a comprehensive agreement to overhaul environmental regulations and streamline federal permitting as part of their debt ceiling deal, instead settling for limited changes that could simplify some project reviews. The final legislation, approved late Wednesday by the House, […]

22 hours ago

Sponsored Articles

...

OCD & Anxiety Treatment Center

5 mental health myths you didn’t know were made up

Helping individuals understand mental health diagnoses like obsessive compulsive spectrum disorder or generalized anxiety disorder isn’t always an easy undertaking. After all, our society tends to spread misconceptions about mental health like wildfire. This is why being mindful about how we talk about mental health is so important. We can either perpetuate misinformation about already […]

...

SANDERSON FORD

Thank you to Al McCoy for 51 years as voice of the Phoenix Suns

Sanderson Ford wants to share its thanks to Al McCoy for the impact he made in the Valley for more than a half-decade.

...

Desert Institute for Spine Care

Spinal fusion surgery has come a long way, despite misconceptions

As Dr. Justin Field of the Desert Institute for Spine Care explained, “we've come a long way over the last couple of decades.”

Georgia nuclear rebirth arrives 7 years late, $17B over cost