A nuclear plant being built in Georgia is now expected to cost its owners more than $30 billion.
A financial report from one of the owners on Friday clearly pushed the cost of Plant Vogtle near Augusta past that milestone, bringing its total cost to $30.34 billion.
This amount does not include the $3.68 billion that original contractor Westinghouse paid out to owners after going bankrupt, which would bring the total outlay to more than $34 billion.
Vogtle is the only nuclear plant under construction in the United States, and its costs could deter other utilities from building such plants, even if they produce electricity without emitting climate-altering carbon emissions.
The latest budget increase, by the Municipal Electric Authority of Georgia, came as no surprise after major owner Georgia Power Co. announced delays and overruns of $920 million on March 3. Georgia Power’s costs only cover the 45.7% of the plant it owns, meaning the co-ops and municipal utilities that own the majority of the two-reactor project are also later updating their projections. financial.
MEAG, which owns 22.7% of Vogtle and supplies power to city-owned utilities, raised its forecast for total costs, including capital expenditures and borrowing costs, to $7.8 billion. from the previous level of $7.5 billion.
Oglethorpe Power Corp., which supplies electricity to 38 co-ops in Georgia, owns 30% of Vogtle. In March, the cost of its projects rose by $250 million to $8.5 billion.
The city of Dalton, which owns 1.6%, estimated its cost at $240 million in 2021. It has not released a public update.
The municipal utility of Jacksonville, Florida, as well as other municipal and cooperative utilities in Florida and Alabama are obligated to purchase power from the plant.
When approved in 2012, the third and fourth reactors were expected to cost $14 billion, with first electricity generated in 2016. Now, the third reactor is expected to start operating in March 2023 and the fourth reactor is expected to start operating in december. 2023.
Atlanta-based Southern Co., which owns Georgia Power, billed growing shares of its cost overruns as shareholder losses, saying the Georgia Public Service Commission is unlikely to approve adding amounts to the bills of Georgia Power’s 2.6 million customers. But Oglethorpe, MEAG and Dalton have no shareholders, meaning customers are fully exposed to overruns.
Georgia Power customers, as well as some Oglethorpe customers, are already paying Vogtle’s costs.
To protect themselves, the other owners signed an agreement with Georgia Power in 2018 specifying that if costs reach a certain point, the other owners can choose to freeze their costs at that level. In exchange for paying more of the costs, Georgia Power would own a larger share of the reactors.
Oglethorpe wants to freeze its costs at $8.1 billion, selling 2% of the reactor to Georgia Power in exchange for Georgia Power paying $400 million more in costs. MEAG also said on Friday it wanted to freeze its costs, but did not say how much it was looking to switch to Georgia Power.
Southern acknowledged it will have to pay at least $440 million more to cover what would have been other owners’ costs, and said an additional $460 million is in dispute.
Georgia Power disputes the cost threshold at which it should bear more of the burden and says it should not have to pay other owners’ share of the additional costs resulting from COVID-19. The owners are in talks aimed at resolving their disagreements.
“Cost sharing is imminent, however, until the parties reach an agreement, Oglethorpe will continue to pay its full share of construction costs as billed by Georgia Power, but will do so subject to contract,” said Oglethorpe CEO Mike Smith in March.
All owners voted to proceed with construction on February 25. Additionally, the owners report that the United States Nuclear Regulatory Commission completed a follow-up inspection of wiring issues at the third reactor in March and approved that the issues it identified in November had been fixed, bringing the reactor to its less intensive basic inspection regime.
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