The expansion of Plant Vogtle could allow Georgia Power Co. to pass along as much as $2 billion in customer benefits – roughly double the initial forecast of $1 billion, company officials said.
The changes – which involve costs the company would not have to recover from ratepayers once the new reactors begin making electricity – were disclosed in testimony filed Friday with the Georgia Public Service Commission.
“The company continues to believe that when the project is completed, and all costs and savings are considered, the project will have a more favorable impact on customers than was projected at the time of certification,” said a transcript, filed Friday, of testimony from Nuclear Construction Support Vice President David L. McKinney and Resource Policy and Planning Director Kyle Leach.
The change, they said, was due to factors including lower than expected debt costs, the pending loan guarantees from the U.S. Department of Energy and production tax credits the company will be able to take once the units are in service.
The testimony was made in support of the construction monitoring report filed Feb. 29 that indicated nuclear construction was moving ahead at the Burke County site after the Nuclear Regulatory Commission’s Feb. 9 approval of a combined operating license. The projected $14 billion cost of construction remains unchanged and the company officials said the current schedule still supports placing the new reactors into service in 2016 and 2017.
Part of the cost of the project – about $8.3 billion, of which Georgia Power would use the largest share – would be financed through the federal loan guarantee. The officials testified, however, that the terms of that funding source remain incomplete.
“The company is engaged in negotiations with the DOE for the loan guarantee, which are expected to conclude during the first half of this year,” the testominy said.
The Vogtle units are the first new commercial reactors to be built in the U.S. in almost three decades — and also represent the first Westinghouse AP1000 units constructed in this country.
The projected higher customer benefits from Vogtle are is the second bit of good news for ratepayers.
Last week, Georgia Power filed a request for a rate reduction for its customers that will be in effect for about two years and would reduce most residential bills by about 6 percent.
The reduction, which would go into effect July 1 if approved by the PSC, would amount to about $567 million annually – or a monthly reduction of about 6 percent for the typical residential consumer averaging 1,000 kilowatt-hours. Total fuel rate reductions would average about 19 percent.
The rate reduction, spurred by reduced energy costs associated with lower natural gas prices, is unrelated to the Vogtle project.