Oglethorpe Power Throws Future Of Plant Vogtle In Doubt
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.
About Author
Charlie
Founder of GeorgiaPol.com; Now weekly columnist Very interested in Georgia and Georginas. Interest in politics is waning daily.
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I can’t figure out out why this isn’t the biggest issue in every legislative race. The decisions leading up to the nuclear meltdown at Vogle were designed by the Georgia Legislature, the PSC and the former Governor (Perdue). If this same fact set existed at Hartsfeild Intl. We would be having a different conversation involving race and competance in governing. Why do old white men get a pass when it comes to poor governance, corruption and incompetence? This is the biggest and most egregious scandal in Georgia history and it afffects every single rate payer but its largely under the radar. Why did the entire conservative state government open the wallet of rate payers to be raided bya private entity with zero oversight? Its still happening today and for the foreseeable future with scant calls for cleaning house in state government.
Georgia Power and parent Southern Company had done an excellent job with respect to power generation and transmission for many decades, so we took their word on this, the regulators clearly not being very informed—we’re No.1 for business after all . The decision to construct nuclear plants was them trying to get away from coal.
“It took away any incentive for the company to come in on time and on budget… No company would ever be able to do this unless they were regulated and you had very compliant regulators.” Former PSC member Bobby Baker regarding SB31 of 2009.
Why isn’t it the biggest issue in every legislative race? Because most of them don’t have a race. Good ol’ boy politics in Georgia still reigns. They just changed their team colors from blue to red a few years back. I can only think of two that carried water for Georgia Power in 2009 that have been defeated at the ballot box, Casey Cagle and Don Balfour. Neither of whom were defeated due to this issue. The rest are either still in the legislature or are now judges and such. So it goes.
Regulation by the government. It’s hurting economic growth. Ask any Trump supporter.
The state rolled over because GP is GP, just as Coke is Coke. They’re the state’s two heaviest players in terms of economic and political clout and they get what they want, on their terms.
Remember how the GaGOP said expanding Medicaid was absolutely out of the question too expensive?
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The $14B overrun amount on Vogtle invested in 5% bonds would return $700,000,000 a year in interest, providing the additional state funding to expand Medicaid until after everyone alive today is dead, plus additional billions over that time to the General Fund.
The people in power always get to write the narrative, I just don’t know why the rest of us go along with it. Again I say, imagine the same fact set at Hartsfield or in Dekalb or Clayton and start writing the headlines. This is one of the most obvious examples of white priviledge and we all get screwed because of it.