Georgia Power takes heat for Vogtle costs, delays |


Georgia Power takes heat for Vogtle costs, delays |

Frustrated utility regulators grilled Georgia Power executives about cost increases at the Plant Vogtle nuclear expansion project Thursday, hinting they might consider capping how much the utility can recoup from ratepayers.

“The trend is delay and overruns … is there any reason to believe that this trend is not going to continue?” Georgia Public Service commissioner Stan Wise said just after the start of a daylong hearing.

Company executives sought to reassure the commission, saying cost jumps have been due to preparation work that’s now finished. They also said they expect no more delays.

It was the commission’s first chance to publicly question Georgia Power about its disclosure in March that the Vogtle project will take about 19 months longer to complete, and cost about $740 million more, than originally expected.

Customers, who have been paying the financing costs since 2011, will pay them for a longer period of time because of the delays.

The company’s share of the estimated $14 billion project will rise to $6.85 billion, up from $6.11 billion.

The project is the nation’s first major nuclear expansion in nearly a decade and is under close scrutiny as a test of the viability of renewed nuclear growth.

“So you don’t think the trend of delay and overruns will continue?” Wise asked David McKinney, vice president of nuclear construction support for Georgia Power’s sister company, Southern Nuclear.

“As we go forward, these risks are going to be fewer and fewer,” McKinney said, adding that the project is about halfway finished.

“At this time we know of no more additional delays to expect.”

Executives said additional worker training and project oversight and stiffer regulatory requirements have boosted labor costs.

Other delays stemmed from Vogtle’s main vendors not meeting stringent documentation rules and other quality assurance requirements. The vendors make critical components for Vogtle elsewhere and then assemble them at Vogtle’s construction site in Waynesboro.

“This is really serious that we’re going down this road,” Commissioner Tim Echols said. “The contractors and their errors are having such an impact on our ratepayers.”

Project delays also have triggered lawsuits among Vogtle’s main contractors and the group of utilities building the reactors. Georgia Power’s liability in those suits totals $425 million, but the utility maintains it is not responsible for the delays or costs associated with them.

Echols asked company executives whether they would consider an agreement similar to the one struck between Mississippi Power and state regulators over a next-generation coal project in Kemper County. The project costs have increased more than $3.42 billion, with the company recently identifying an additional $160 million in overruns.

via Georgia Power takes heat for Vogtle costs, delays |

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