ATLANTA (AP) — An agreement addressing cost overruns at an expanding nuclear power plant will mean millions in short-term savings for consumers, but billions in longer-term costs.
The Atlanta Journal Constitution reports that the pact was approved unanimously Tuesday by the five-member Public Service Commission. The commission’s staff negotiated the deal with Georgia Power, the lead partner in the project to build two new reactors at the Vogtle nuclear plant near Augusta.
The commission said the agreement benefits customers because it avoids potential litigation with Georgia Power over who will cover cost overruns. It also sets stiff penalties if the Atlanta utility doesn’t complete the project by the end of 2020.
The project is more than three years behind schedule and more than $3 billion over its original budget.
The PSC staff and Georgia Power say the Oct. 20 pact will save ratepayers about $185 million over the next four years.
“I think what we’ve done is remove the threat of litigation and front-load a lot of savings,” said Chuck Eaton, PSC chairman.
Critics of the deal include the Southern Alliance for Clean Energy. The advocacy group, said the deal short-circuits the agency’s chances to disallow almost $1.6 billion for Georgia Power’s share of the cost overruns under a previously planned “prudency hearing” once the project is finished.
The settlement gives Georgia Power an additional 18 months to complete the first new unit and six months to complete the second one.
The deal also delays Georgia Power’s collection of another $139 million until the project is completed, over the expected 60-year life of the reactors.
Customers’ rates won’t go down as a result of the deal. They just won’t go up next year, because a surcharge on customers’ bills that finances the Vogtle project is expected to stay at this year’s level. As part of the settlement, Georgia Power withdrew a request to increase the surcharge next year.