Residential customers of Georgia’s largest electrical utility could see their bills rise another $9 a month to pay for a new nuclear power plant under a deal announced Wednesday.
Georgia Power Announces Deal for Nuclear Power Plant
Georgia Power Co. said customers would pay $7.56 billion more for Plant Vogtle construction costs under the agreement with utility regulatory staff.
Commission Approval Needed
The Georgia Public Service Commission’s five elected commissioners must approve any deal, but such agreements are typically persuasive. With the commission’s Public Interest Advocacy staff and three leading ratepayer groups signing on, the agreement is likely to avert contentious hearings over how much blame the company should bear for billions in cost overruns at two new nuclear reactors southeast of Augusta.
The First New American Reactors
Vogtle’s Unit 3 and Unit 4 are the first new American reactors built from scratch in decades. Each reactor can power 500,000 homes and businesses without releasing any carbon. But even as government officials and some utilities are again looking to nuclear power to alleviate climate change, the cost of Vogtle could discourage utilities from pursuing nuclear power.
Response from Georgia Power Spokesperson
Jacob Hawkins, a Georgia Power spokesperson, said the agreement represents “a balanced approach that recognizes the value of this long-term investment for the state and recognizes affordability needs for customers.”
Reaction from Consumer Advocacy Group
Liz Coyle, the executive director of Georgia Watch, a consumer advocacy group that signed the agreement, said the reactors will never be cheaper than alternative sources of power. But since regulators, traditionally friendly to Georgia Power, allowed them to be built, Coyle said it was important to limit consumers’ exposure.
Overall Project Cost
The overall cost of the project, including financing, is currently $31 billion for Georgia Power and three other owners, Associated Press calculations show. Add in $3.7 billion that original contractor Westinghouse paid the Vogtle owners to walk away from building the reactors, and the total nears $35 billion. The overall project is seven years late and $17 billion over budget.
Georgia Power’s Construction Costs
Georgia Power says it has spent $10.2 billion on its share of construction costs for Vogtle Units 3 and 4. Public service commissioners originally approved the largest unit of Atlanta-based Southern Co. to spend $4.4 billion. After years of delays and cost overruns, the commission said in 2017 that it would consider $7.3 billion as a reasonable cost for Georgia Power.
Impact on Utility Bills
The company says that would work out to an additional $8.95 per month for a typical residential customer, atop the roughly $5 that customers started paying this month when Unit 3 entered commercial operation. The further bill increase would begin when Unit 4 enters commercial operation.
Concessions for Ratepayer Groups
Ratepayer groups won some other concessions. Georgia Power agreed to double the size of a bill-relief program and to expand energy efficiency programs by 50% to help reduce energy use and lower bills beginning in 2026. The company also agreed to support state applications for a share of $7 billion in federal grant funds to expand solar energy to low-income households.