Southern Co. received a fifth extension last week to allow more negotiations with the U.S. Energy Department over its offer of up to $8.3 billion in federal loan guarantees. The most recent extension expired Dec. 31, and the new extension gives them until Jan. 31 to continue discussions.
“We are encouraged by recent progress in our loan guarantee negotiations as we work with the Department of Energy to address a few remaining points, including the need for intergovernmental agency review and approval,” Southern Co. spokesman Tim Leljedal said in an e-mail.
Details of the negotiations are confidential. 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 Vogtle 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.
Loan guarantees, in which the government promises to assume a company’s debt if the company defaults, were developed as an incentive for new nuclear construction.
Vogtle construction can continue without the loan guarantee, Leljedal 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,” he said.
The new Westinghouse AP-1000 reactors under construction at the Burke County site are scheduled to go online in 2017 and 2018.
Critics of the federal loan guarantee include environmental group Friends of the Earth, which says Vogtle’s owners should quit negotiating a loan they do not need.
“Georgia Power has stated that it doesn’t need the loan guarantee to continue expansion of the Vogtle reactors, so the government should walk away from this boondoggle and let the private market determine the future of this risky reactor project,” Katherine Fuchs, a nuclear subsidies campaigner for the group, said in a statement.
The group contends that the Vogtle construction has been riddled with cost overruns and scheduling delays, and that more problems will arise as construction continues.