Ratepayers, experts urge PSC to cancel Vogtle nuclear reactors 3 and 4 (update 1)

By Gloria Tatum – Atlanta Progressive News

It’s that special time of year when the Georgia Public Service Commission (PSC) has been hearing arguments about whether to cancel Plant Vogtle’s nuclear reactors 3 and 4, which are in various delayed states of construction; or, alternatively, whether to finish the project.

The 17th Vogtle Construction Monitoring (VCM) hearing ran from Monday, December 11, to Wednesday, December 13, 2017.

Georgia Power lawyers and their expert witnesses are facing off against a broad and growing coalition of environmentalists, public interest groups, clean energy advocates, and irate ratepayers, along with their lawyers and expert witnesses, to win the hearts and minds of the PSC.

The three-day proceedings to decide Vogtle’s fate started off with PSC Chairman Stan Wise announcing that the Commission’s vote on Vogtle’s fate had been moved from February 11, 2018, to December 21, 2017.

Wise had previously sent a letter to Paul Bowers, CEO of Georgia Power, with concerns about the potential corporate tax change next year from the current 35 percent to 20 percent.    If the project is canceled this year, the Company would realize 150 million dollar larger tax benefit under the current tax rate.

The Southern Environmental Law Center was not happy about this schedule change and has filed an objection to Wise decision, and say Wise engaged in “ex parte communications” with Georgia Power, that is, communications that occurred outside the hearing process.

Now everyone is hustling to file final briefs before the December 19, 2017 deadline, which will create a huge paper dump two days ahead of the alleged final PSC vote on Vogtle’s fate.

The Integrated Project Schedule (IPS) that people have been waiting to receive for nine years will also be dumped on December 19.

Chairman Wise’s next move was to ban John Noel from public comment.  Noel is running for Commissioner Chuck Eaton’s District 3 seat on the Commission in 2018.

Wise angrily snapped that he would not allow Noel to use public comment time to promote his candidacy for PSC.

However, on December 13 during lunch break, Noel returned to give his three minute public comment to an empty room.  Noel posted a video of his banned speech to Facebook:


This infuriated Wise when he learned about it.  Wise cited rule 515-1-1-.02, which gives him the power to preserve strict order allegedly as he sees fit.

Wise threatened to have Noel handcuffed and arrested.   Noel replied that it did not matter that the room was empty because they don’t listen to the public anyway.


After all of Chairman Wise’s bullying antics, the actual hearing began with the PSC Staff, financial analysts, and expert witnesses in agreement that ratepayers should not be saddled with all the cost overruns because of Georgia Powers poor management.

The results of PSC Staff’s economic analysis indicate that the project, with its current commercial operation dates of November 2021 and 2022, are uneconomic by 1.6 billion dollars.

Georgia Power’s latest forecast of a 68 month delay, up from 39 months last year; and a total project cost of 12.2 billion dollars, up from 6.1 billion dollars at certification.

The 12.2 billion represents only Georgia Power’s part of the total cost.  The total new price tag is about 23 billion dollars.

Even with an anticipated Toshiba Parental Guarantee payment, the reduced project cost for Georgia Power is still 10.5 billion, which is 1.5 billion over what would be a break-even point for ratepayers, according to PSC analysts.

But–given Georgia Power’s history of making unrealistic estimates–the PSC staff and expert witnesses expect additional cost overruns and schedule delays if this project goes forth, especially with a lot of work yet to be completed.

The PSC staff’s primary recommendation is for the project to go forward but with the reasonable cost set at 9.0 billion dollars.

“It would be unreasonable for the company to recover any cost above 9.0 billion from the ratepayers, and cost above 9.0 billion should be absorbed by the Company,” Tom Newsome, Director of Utility Finance for the Commission Staff, testified.

If the Commission chooses not to follow this Staff recommendation, then the Staff’s alternative recommendation is to cancel the project.

But of course Georgia Power has requested to be certified for reimbursement of the full 12.2 billion dollars to complete the project.

Georgia Power has threatened that, unless the Commission shifts the entire 12.2 billion dollar cost to ratepayers, it or its co-owners will cancel the Project.

Liz Coyle, Executive Director of Georgia Watch, questioned the PSC staff witnesses about the financial impact of cost overrun on ratepayers.

“The nominal life cycle capital cost revenue requirement collected from ratepayers would increase from 23 billion dollars to 37 billion dollars,” PSC staff answered.

“If the Commission adopts the Company’s recommendations as filed, the Company profits will increase 5.2 billion dollars and ratepayers will pay an additional 14 billion dollars,” Coyle clarified.

“So if the Commission ordered a reduced Return on Equity (ROE) for the Company as part of allowing them to complete the project could, they cut 3 or 4 billion dollars from the Company’s profit of $5.2 billion… and also have a lower impact on what ratepayers would pay over the life of the Units,” Coyle asked.

“Yes, you are correct,” PSC staff agreed.

Commissioner Wise voiced concerned that the Company would have problems accessing capital markets with a much lower ROE.

Staff explained that the reduced ROE is only on Vogtle’s rate base and only through the construction period until 2022.  The current ROE is 10.5 percent guaranteed profit for the Company.


Peter Bradford, an expert witness for Southern Alliance for Clean Energy (SACE) said he was pro-nuclear but that he was opposed to paying too much for the electricity that Georgia will need over the next twenty years.

Bradford served on the U.S. Nuclear Regulatory Commission (NRC) from 1977 to 1982 and is a professor at Vermont Law School, where he teaches “Nuclear Power and Public Policy.”

“I’m against the decision-making framework that Georgia Power presented here – that it’s nuclear or nothing… The evidence suggests that combinations of gas, renewables and energy efficiency, and grid enhancement can do the job at less cost,” Bradford said.

“I would not certify the reasonableness of continuing Vogtle construction on the terms requested by Georgia Power,” Bradford said.

Customers no longer have the protection of the Engineering, Procurement, and Construction (EPC) agreement, since the bankruptcy of Westinghouse, he said.

Westinghouse is accused of not using professional engineers to approve blueprints on the canceled V.C. Summer reactors in South Carolina.

Glenn Carroll, Director of Nuclear Watch South, has filed with the Georgia Professional Licensing Boards to discover if a similar problem happened at Vogtle.

During cross examination, Erin Glynn, an attorney for NWS, gave explosive news that Southern Nuclear’s engineering license expired in 2000, over seventeen years ago.

Southern Nuclear, like Westinghouse, has no experience running a massive nuclear construction project.

NWS expert witness Joseph Pokalsky, who previously worked for Price Waterhouse Cooper, the accounting firm which produced Georgia Power’s risk analysis, testified that this method is known as “the lack of knowledge method,” and he showed how to manipulate the outcome by controlling the data inputs.

Georgia Grassroots Video posted to Youtube a video of a press conference held by Nuclear Watch South.


On the last day of the hearing, Becky Rafter, Executive Director of Georgia Women’s Action for New Directions, presented to the PSC a new report, “Community Impacts at the Crossroads of Nuclear and Climate Injustices in the U.S. South.”


In related news, the Jacksonville Electric Authority (JEA) now wants out of their 2008 contract to buy Vogtle energy.

JEA officials have told analysts they no longer want the nuclear power, and they want the PSC to cancel the long-delayed and increasingly expensive Plant Vogtle 3 and 4, according to the Florida Times-Union.



Source: Atlanta Progressive News

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