Deal: 'Good solution' if Georgia Power absorbed Vogtle costs

Friday, July 26, 2013 12:00 PM
Last updated 11:50 PM
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Deal  Stephen Morton
Stephen Morton
Deal

SAVANNAH, Ga. — Gov. Nathan Deal said this week that it would be a “good solution” if Southern Co. absorbed more of the extra costs incurred while building new reactors at Plant Vogtle.

The Republican told WSAV-TV that the state’s Public Service Commission must ultimately decide whether Southern Co. subsidiary Georgia Power can increase its construction budget by $737 million. The utility has announced it cannot meet its original $6.1 billion budget to build two reactors.

Customers will pay the cost of building the new plant, unless utility regulators block the company from passing along construction costs they find objectionable.

“There are certainly points to be made on the side of those who say the company should absorb more of the cost and not pass it on to ratepayers. Certainly if that could be done, that would be a good solution,” Deal told the TV station. “But I think we can’t lose sight of the fact that those two nuclear reactors will be the first new nuclear reactors in the United States in several decades, and it’s in my opinion a necessary impact of keeping the state of Georgia with adequate power resources.”

Georgia Power officials would not directly comment on Deal’s remark.

The utility said in a statement that building the reactors is the best economic choice for customers. The company said it’s using state-of-the-art technology and has an agreement with contractors meant to minimize financial risk to the utility and customers.

Earlier this month, Deal blamed rising construction costs on litigation filed by environmental groups, despite evidence to the contrary from Southern Co. and the independent monitor working for the state.

Southern Co. has attributed most of the cost increases to licensing, production and construction problems, but not legal challenges.

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Little Lamb
46074
Points
Little Lamb 07/26/13 - 06:20 pm
2
1
Inflation

The two trillion dollar fiscal stimulus the Federal Reserve pumped into the money supply must inevitably cause wage and price inflation. We have already seen prices rise in foodstuffs and energy. General price inflation will follow, and workers will demand wage increases. It will begin with a whimper, but it will soon rage and will dominate the economy for six or eight years, if history is any guide. Georgia Power did not factor in the Fed's stimulus when they make that rosy estimate of $6.1 billion. Things do not look pretty on this for Southern Company stockholders and bondholders if the PSC makes them eat all the overruns.

Stockholders and bondholders should pay for overruns caused by bad management of the construction process. But cost overruns caused by general inflation should be paid by ratepayers.

oldredneckman96
5095
Points
oldredneckman96 07/26/13 - 09:59 pm
1
0
Vogtle 3&4
Unpublished

Little Lamb hit it on the head as to why the plants will cost more. The thing is all of us will pay more for energy in the future due to liberals spending like drunken sailors. Just tell me if you think Obama has a clue as to what it takes to have the lights shine on Air Force 1 while it is flying his family on million dollar vacations? Little Lamb got it right.

corgimom
32627
Points
corgimom 07/27/13 - 10:31 am
0
1
Nuclear plants always cost

Nuclear plants always cost far more than they are budgeted, it has nothing to do with the Federal Reserve.

Once they start building, they always run into problems. A nuclear power plant isn't like a store building; they are immense, and there are always problems that are discovered along the way. It's impossible to predict all the problems before they are built.

corgimom
32627
Points
corgimom 07/27/13 - 10:33 am
0
1
And a nuclear plant takes

And a nuclear plant takes years to build. And the NRC constantly changes its regulations, so while a blueprint may be approved, by the time the construction occurs, years down the road, the requirements are different.

oldredneckman96
5095
Points
oldredneckman96 07/27/13 - 09:20 pm
1
0
Cost
Unpublished

Politicians always cause the cost to rise with increased demands of graft from the utility. The PUC boards recent demands of more solar and wind power be bought by Southern Co is a great example. The license for plant is approved before any construction can begin. No one would start a project this important without knowing exactly what the result would be, except for Congress with Obamacare!

oldredneckman96
5095
Points
oldredneckman96 07/28/13 - 04:17 pm
1
0
Here is a cost fact, from the real world.
Unpublished

Thu, Jul 25 2013 5:26 AM From the Nuclear Street News;
Rising natural gas costs and the closure of the San Onofre nuclear plant bumped up wholesale electricity prices by 59 percent in California during the first half of 2013, compared to the same period last recent report by the Energy Information Administration also noted a "large and unusual separation in power prices between the northern and southern parts of the state's electric system" because of the nuclear plant's absence. Faulty steam generators had kept San Onofre's two reactors offline for more than a year when Southern California Edison decided to shutter them permanently last month. On Wednesday, the utility announced the last fuel had been removed from unit 2 on July 18, allowing the plant to relinquish its operating licenses. Each unit provided roughly 1,100 megawatts to the Southern California grid, leaving power planners scrambling to make up for the shortfall.

Southern Co is going to save you money on your future power bills whether you deserve it or not!

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