The owners of Plant Vogtle have secured – for the third time – an extension to allow further negotiation with the U.S. Energy Department over its 2010 offer of up to $8.3 billion in federal loan guarantees to help finance two new nuclear reactors.
Georgia Power and co-owners Oglethorpe Power and Municipal Electric Authority of Georgia were conditionally approved in February 2010 for loan-guarantee financing, in which the government promises to assume a company’s debt if the company defaults. However, the details were never agreed on.
Two extensions have since expired, with the most recent deadline – June 30 – passing without any formal agreement in place.
Jeannice M.W. Hall, a Southern Co. spokeswoman, said in an e-mail Wednesday that the new extension sets a Sept. 30 deadline for completing the loan guarantee arrangements.
“There continues to be constructive dialogue in the Vogtle 3 and 4 loan guarantee negotiations between the company and the Department of Energy, and we are cautiously optimistic as we work with the DOE,” she said.
Details of the ongoing negotiations, however, are confidential.
“Loan guarantees were developed to provide an incentive for new nuclear development in the U.S.,” Hall said. “We are committed to financing options that will serve the best interests of our customers, and – as long as the terms and conditions of DOE loan guarantees serve those interests – we will continue to pursue that option.”
Critics of the federal loan guarantee program include the nonpartisan watchdog group Taxpayers for Common Sense, which claimed in a report this week that such deals expose taxpayers to financial risk.
“This whole thing has the stink of another Solyndra-like goose egg for American taxpayers,” said Ryan Alexander, the group’s president.
The nuclear expansion has made progress but has also generated lawsuits, delays and cost overruns that Alexander believes will continue to emerge, possibly adding billions of dollars to its original cost estimate.
The government’s $8.3 billion offer included up to $3.46 billion for Georgia Power, which owns a 45.7 percent stake in the project; up to $3.05 billion for Oglethorpe, which owns 30 percent; and up to $1.8 billion for MEAG, which owns 22.7 percent.
The project’s remaining 1.6 percent is owned by Dalton Utilities.
The new Westinghouse AP-1000 reactors under construction at the Burke County site are scheduled to go online in 2017 and 2018.