Georgia Power and Southern Company’s nuclear arm said they expect to take over formal management of the Plant Vogtle nuclear project in late July after a key contractor ditches its contract with the Atlanta utilities in bankruptcy court.
Under a recently completed new agreement with Georgia Power and Southern Nuclear, Westinghouse Electric will continue to provide engineering and other support to the troubled project.
The Plant Vogtle expansion, to add two new reactors at the site near Augusta, is already at least $3 billion over budget and well over three years behind schedule. Disruptions from the Westinghouse’s late-March bankruptcy filing are expected to add more costs and delays.
Meanwhile, Georgia Power said on Wednesday that it has extended a temporary contract with Westinghouse to continue work on the project until July 20, while Westinghouse seeks the bankruptcy court’s approval to reject the old contract.
The company also said it expects to receive a $300 million payment in October from Toshiba Corp., Westinghouse’s parent company, as the first installment toward making good on almost $3.7 billion in earlier financial guarantees it promised on the Vogtle project.
Westinghouse filed for bankruptcy protection largely due to losses on the Vogtle project and a similar one in South Carolina. The bankruptcy has thrown both projects’ viability into question.
The losses have been a body blow to Tokyo-based Toshiba, which has warned investors in filings that it may not be able to continue as a going concern due to heavy losses at its Westinghouse unit.
That, in turn, has increased worries that Toshiba might not be about to keep up with payments on the $3.7 billion guarantee, which covers earlier overruns.
Georgia Power and its partners, Oglethorpe Power, MEAG and the city of Dalton, are expected to complete an analysis in August of future options for the project, including continuing construction, converting the expansion to natural gas plants or shutting it down.
In a hearing Thursday, a Georgia Public Service Commission official and an independent construction monitor said the Vogtle project fell further behind last year.
But they testified that they also saw signs that the work pace has picked up since Georgia Power and Southern Nuclear increased their oversight at Plant Vogtle after Westinghouse’s bankruptcy.