breaking news

Braves trade Matt Kemp to Dodgers in major salary swap

Plant Vogtle deal would pass on most cost overruns


Georgia Power reached a tentative pact with state utility regulators that would eventually pass on to customers roughly 80 percent of $1.7 billion in cost overruns at the Plant Vogtle nuclear expansion project.

However, in the short run the deal would lead to a $325 million reduction for ratepayers over the next four years if it is approved by the Georgia Public Service Commission.

That’s because the deal also reduces a current surcharge that Georgia Power is collecting on bills to finance the project at the plant near Augusta. The surcharge is now about $100 a year on a typical residential bill.

The PSC announced the tentative deal Thursday. It did not offer any specifics about the effect on customer bills.

PSC spokesman Bill Edge said public hearings on the deal will likely be held in December or January, followed by a vote of the five-member commission. Any rate changes would take effect in January.

Edge said Georgia Power agreed to a lower profit margin on the massive project under the deal.

Some observers said that while the proposed deal would give ratepayers a break over the next few years, it also appears to accept most of the cost overruns that have occurred so far as “prudent,” a crucial distinction because under law the utility can recover all costs deemed “prudent.”

Several months ago, the PSC asked Georgia Power and the agency’s staff to negotiate an agreement on how Georgia Power and customers would split up the cost overruns at the nuclear expansion near Augusta, which is more than three years behind schedule.

The deadline for an agreement was Wednesday but the PSC earlier this week granted an extension.

Consumer advocate Liz Coyle said she’s pleased to see the agreement cuts customers some slack and that the PSC committed to public hearings before voting.

“It’s a step in the right direction because customers are overwhelmingly bearing the burden of cost overruns,” said Coyle, executive director of consumer advocacy group Georgia Watch.

But she said the finance charges have already been boosted by the overruns, so the deal only reduces that amount for the next four years. She called the deal “complex,” adding that all the effects weren’t immediately clear.

The deal judges all costs on the project through last year as “prudent,” including Georgia Power’s portion of a $760 million settlement of a lawsuit with former project contractors.

That means all costs up to that date — almost the total amount so far — will almost certainly be rolled into customers’ bills for decades to come if the PSC approves the deal.

The deal also adds a $240 million “contingency” amount to the project’s total projected cost to Georgia Power. That could be a sign of further expected cost overruns, according to critics of the project.

Georgia Power’s total share of the project was $6.11 billion when the project was approved in 2009, the PSC said. Other partners’ share of the project was $7.26 billion at that time. The project is now more than $3 billion over budget for all parties. The other partners are Oglethorpe Power Corp., city of Dalton utilities and the Municipal Electric Authority of Georgia.

The project will add two new reactors at Plant Vogtle, which already has two in operation.

One reactor is currently slated to be completed by the end of 2019 and the other by the end of 2020.


Reader Comments ...


Next Up in Business

Malls not too hectic before upcoming holiday weekend
Malls not too hectic before upcoming holiday weekend

Maybe it’s the oft-reported decline of brick-and-mortar retail. Maybe last weekend’s snow days didn’t slow down the pace of shopping. Whatever it is, today appears to be a good time to hit the malls and check off Christmas list items. This morning — on the start of the last full weekend before Christmas Eve — some major...
11 rookie mistakes to avoid during the first year of your new job
11 rookie mistakes to avoid during the first year of your new job

Whether you're in your first job straight out of college or are a seasoned professional starting with a different company, your first year can set the tone for success or failure.    Early mistakes can be difficult to overcome and can torpedo your career in the longer term. Each office has its own way of doing things, and it's part of your...
Season growing hectic for Atlanta companies that deliver
Season growing hectic for Atlanta companies that deliver

A 53 foot-long truck backs up to the loading dock at the Alpharetta FedEx center, straight from the airport. Inside are containers weighing up to 5,000 pounds, each loaded with packages headed for homes and businesses on the north side of metro Atlanta. There are probably three more trailers coming later in the day. As the holiday season approaches...
RIP AIM: AOL retires its pioneering Instant Messenger app
RIP AIM: AOL retires its pioneering Instant Messenger app

It’s the end of an era. As of Friday, web company AOL’s groundbreaking Instant Messenger program is no more. Oath, the entity formed by AOL combined with Yahoo, announced in October that it would retire AOL Instant Messenger (AIM) on Dec. 15. As of Friday, users were no longer be able to sign into AIM. Officials with Oath said in October...
Solid growth for Georgia economy, predicts UGA’s Terry College
Solid growth for Georgia economy, predicts UGA’s Terry College

While the risk of a downturn is creeping up, the odds are good that the coming year will bring solid economic growth in the state’s industries, according to the annual forecast by the University of Georgia’s business school. Fewer jobs will be created than in the past few years, said Benjamin Ayers, dean of UGA’s Terry College. Still...
More Stories