Vogtle price tag lower than expected for Georgia Power

ATLANTA -- The official price tag for Georgia Power’s share of two new reactors at Plant Vogtle is now $1.5 billion lower than when the company originally requested permission to build them, according to testimony Tuesday before the Georgia Public Service Commission.

The company also told the regulatory panel that construction is on schedule and within budget so far.

The testimony by company executive Jeffrey Burleson came during the commission’s first, semi-annual hearing to oversee the cost of the construction.

“The actual schedule itself is a Georgia Power Company trade secret,” Burleson told the five commissioners.

The commissioners reviewed copies of the secret data during the two-hour hearing, and no details were revealed during the questions crafted to avoid disclosure. Lawyers for consumer and business groups who signed confidentiality agreements also have access to the secrets, but none questioned Burleson when given the chance to cross examine him.

Projected construction costs dropped, Burleson said, because the company is avoiding some interest by charging its customers for the reactors before they begin operation. A law and a commission decision, both enacted earlier this year, allow the company to break from normal practice and pass along expenses to ratepayers while construction is in progress.

The company had argued consumers would see a savings if the controversial law and decision went their way, and Burleson said the lower cost projection proves it. Many consumer groups had fought the change, warning that frequent safety-design changes often drive up the price of commercial reactors before operation.

Commission attorney Jeffrey Stair brought up the U.S. Nuclear Regulatory Commission’s delay in issuing a license for the reactors because it wants more information about the design of the building that would contain the radiation from the atmosphere. Burleson told him the construction schedule included enough flexibility that the NRC’s delay would not throw off the overall construction timetable.

To try to keep a lid on costs, the commission required the company to issue semi-annual status reports and to pay for the commission to hire an independent firm to monitor construction. However, Georgia Power won’t allow the monitor’s employees attend meetings where construction decisions are made.

“If there is a regulator’s representative sitting in, wouldn’t that chill the free flow of discussion,” asked Georgia Power attorney Kevin Greene.

Yes, Burleson said, adding that candor is important to critical decisions. Plus, the company does give minutes of the meeting to the monitor’s staff.

The commissioners took no action during the hearing. Afterward, Commissioner Lauren “Bubba” McDonald expressed his satisfaction.

“We are pleased with the progress at this time,” he told reporters.

Future hearings on costs are likely to be longer and more involved once construction progresses beyond moving dirt around for site preparation, according to Commissioner Stan Wise.

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Georgia Power estimates the average residential customer, who pays about $100 per month today, will pay an extra $1.30 each month. The charge will change, based on the pace of construction, financing rates charged to the company and the price of fuel used to generate power at existing plants. Based on the company's projected construction timeline, the monthly charge would rise by about $1.30 each of the six years the reactors are expected to be under construction, finally reaching $9 or so each month.

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