“Utility aims to justify overage”

PSC will decide who pays for Vogtle cost overruns

By Walter C. Jones

ATLANTA — On Wednesday, government regulators, lobbyists and lawyers for electricity-customer groups were pouring over nearly 1,000 pages of legal documents that Georgia Power filed late the previous day asking that consumers pay for cost overruns at Plant Vogtle. Their preliminary impressions were not sympathetic to the company.

Georgia Power doesn’t have to convince them. Instead, it’s the five men serving on the Public Service Commission who will decide sometime late fall how much customers are stuck with and how much company investors must swallow.

“The Plant Vogtle expansion is the most important infrastructure project currently underway in Georgia and will ensure that our state has clean, safe, affordable and reliable electric energy for decades into the future,” said Paul Bowers, the utility’s chairman. “We are committed to managing this important project well, and every dollar we have invested has been necessary to complete the new units safely and correctly to best serve our customers.”

State law says that customers must pay if the company was “prudent” when it spent the money for approved construction. The documents include expert comments that the expensive delays and budget overages were necessary parts of restarting nuclear construction after a three-decade break in this country and the need to maintain quality for safety reasons.

Critics blame poor management and say customers shouldn’t have to bear that cost.

“Georgia Power is trying to get the Georgia Commission to accept their doublethink that cost overruns are prudent, excessive construction delays are reasonable and believing both of these ideas is logical,” said Sara Barczak, program director for Southern Alliance for Clean Energy.

Other customer-oriented groups agree, based on hearings on semiannual progress reports.

“The evidence presented over the past 13 Vogtle Construction Monitoring Report hearings clearly point to imprudence, especially in the early years of the project, including the issues litigated with contractors,” said Liz Coyle, director Georgia Watch, a self-styled consumer advocacy organization.

The months of legal wrangling, auditing and testimony will take place now, instead of when the two reactors begin operations, because the company needs to give Wall Street some good news after devastating cost overruns at an experimental coal-burning plant in Kemper County, Miss., where state regulators have found imprudence and forced sister-company Mississippi Power’s investors to swallow of nearly $4 billion in overages.

The Plant Vogtle construction, for two nuclear reactors, is three years behind schedule. Much of the delays and overage occurred at the beginning, prompting the utility to sue the building contractor.

The lawsuit was settled out of court last fall with Georgia Power agreeing to pay the builder $350 million. Getting the commission to go along led to the massive filing Tuesday as the company seeks to justify the settlement.

SOURCE: The Augusta Chronicle