September 24, 2018 7:46 PM
The board of Oglethorpe Power, one of the owners of Plant Vogtle’s units 3 & 4 currently under construction in Burke County near Waynesboro, has just voted to proceed but demand a cost cap for finishing construction amid escalating costs and multiple extended deadlines. Earlier today another owner, MEAG – the Municipal Electrical Association of Georgia, voted to continue with the project. Currently, Georgia Power is not offering a cost cap as the general contractor, throwing the future of the project once again in doubt.
Background on the current situation comes from Kristi Swartz at E & E news, and the entire article is a short encyclopedia of the situation and worth your time if you need to get up to speed. A new wrinkle from the same article is below, as the U.S. Department of Energy is considerating accelerating repayment of loan guarantees if construction is not completed:
The companies have received billions of dollars in loan guarantees and will have 25 years to repay the money if they move forward, as is currently the case.
But DOE officials said they could require Georgia Power and Oglethorpe to pay back $5.6 billion of $8.3 billion in loans within five years under an accelerated timeline should the project be scrapped.
DOE could decide to treat MEAG differently. The nonprofit regional power authority is under legal and public pressure from JEA — the Jacksonville, Fla., electric company — to walk away from the project. JEA recently sued MEAG to get out of its long-term contract to buy some of the electricity from Vogtle once the reactors are finished. MEAG immediately countersued.
DOE already halted payments for the project in March 2017 after Vogtle’s main contractor, Westinghouse Electric Co. LLC, declared bankruptcy. But concern at the agency about Vogtle’s future peaked after JEA’s actions.
The decision by Oglethorpe Power provides more questions than answers to a project that has been veiled in uncertainty since it’s primary original contractor, Westinghouse Electric, declared bankruptcy. A similar project in South Carolina not as far along as Vogtle has been idled. That, at least until now, has left Vogtle 3 & 4 the only nuclear power plants currently under construction in America. China, by contrast, has approximately 20 units under construction with more planned, in an attempt to lesson the country’s dependence on coal powered electricity.
Questions remain for ratepayers of Georgia Power, Dalton Utilities, MEAG member customers, and Oglethorpe Power as to what will happen if the project is abandoned, but current invested costs will likely still be recouped even if the plants generate nothing.
For most of us, I will resort to the words of the great Marty Huggins: It’s a mess.